Sensex @ 40,000 : Time to think big! $100 bn household savings still to enter market

Investors should look beyond fancied names & be conservative as FY18 will be another rewarding year for stock pickers.

There is a lot of value left in thousands of Indian stocks. Identifying and buying them is the key. Investors should look beyond fancied names and be conservative as FY18 will be another rewarding year for stock pickers.

Trying to predict the market is a futile exercise. Any correction when it happens is an opportunity for smart stock pickers to buy their favorite stocks at discount.

Stock picking is the game. There is a lot of value left in thousands of Indian stocks. Identifying and buying them is the key. Look beyond fancied names and be conservative, FY18 will be another rewarding year for stock pickers.

India has many potential turnaround stories's both management and business turnarounds. Many managements in the past have been unethical towards minority investors and used to siphon off funds to avoid taxes and create personal assets. In the changing environment, there is no incentive for this. Many of these managements are changing naturally, others will be forced to change.

GST is a done deal now.

Reforms are a continuous process, we are lucky to have a responsible, prudent government at Centre focused on improving ease of doing business and plugging the infrastructure deficit. We can look forward to more Land, Labour and direct tax reforms ahead.

Digitisation is going to create a level playing field for honest entrepreneurs. At the same time, we might have a disruptive time ahead with many traditional businesses becoming redundant with technology advancements. Reinventing businesses will only survive.

One can expect $100 billion fund-flow into equities from Indian households during next 18 months. It is a big sum. We are in the middle of a SIP revolution, Equity is the most attractive asset class and there will be big inflow from retail investors. USD 100 bn is not a big amount it's just 5% of India's GDP, less than a third of the planned spending in infrastructure by the government. 

We have been accustomed to thinking small, but now is the time to think big and make it large. Sensex @ 40,000.

Happy Investing

Source:Moneycontrol.com