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00:00We have with us Mr. Chakri Lokpriya from RSBLLP, who joins us now, a managing partner at RSBLLP
00:08who joins us now.
00:09Welcome to the show.
00:10Hello, good afternoon.
00:11Good afternoon.
00:12So my first question to you is, you know, markets at all time high, where do you see
00:18this going forward?
00:21I think, you know, we go faster and higher for the rest of the year.
00:26You know, it's been an incredible journey when I started in this business in 1998, Nifty
00:33was roughly 4,000, today it's at 22,500.
00:38So and it's a very reasonable valuation, even after all the run.
00:42So I think, you know, the market ends up much higher at the end of 2024.
00:47Right.
00:48Harsh, would you like to get in with some questions?
00:51Well, yes, absolutely.
00:53Hi, Chakri.
00:54Good afternoon.
00:55Hi, good afternoon.
00:56Chakri, quickly with regard to markets itself, we're back to all time highs.
01:03Where do we go from here, in your view?
01:06We have elections in front of us, which is a possible curveball.
01:10But outside of that, do you expect markets to continue to go higher before elections
01:16as well?
01:17And what could be those themes, those sectors which could drive markets higher?
01:22You know, elections is actually just a data point in between, a meaningful data point
01:27though.
01:28So in the run up to the date until June, I think the market continues to stay higher.
01:34There might be volatility closer to the date.
01:37But after that, I think we'll get back to business as usual and the market would head
01:42higher simply because earnings, if you take banking, metals, pharmaceuticals, all big
01:49sectors within the Nifty, they have not really gone up that much.
01:53And you look at the valuation, banking is still at under two times, pharmaceuticals
01:58are still cheap, metals are still five times even better, etc.
02:01The list is long.
02:02So which means sufficient comfort for a higher market.
02:06Understood.
02:07But, you know, relative to your historical valuations, markets are largely in line, if
02:13not above, in terms of price to earnings.
02:17Do you expect a significant re-rating in FY25 in terms of earnings growth, which could
02:22drive markets higher?
02:25I think the answer is clearly yes.
02:27And the reason why we will have an earnings upgrade is as and when the US interest rates
02:34peak out and rather they start cutting interest rates, RBI will follow suit, interest costs
02:40for Indian corporates would go down and that would bump up earnings estimates.
02:45And therefore, the P.E. of the market would look cheaper.
02:50And even now, at about 22 times, it's still a very reasonable market.
02:56Understood.
02:57Chakri, one sector, if you had to pick, which would that be at this point?
03:02And one sector which you would be most cautious on at this point?
03:07I'd still be very positive on manufacturing, despite all the fantastic run-up, all the
03:12related sectors to manufacturing, whether it is defence, railways, infra, EPC, auto
03:20ancillary, bearing companies, etc., they all have done very well, will continue to do well.
03:26What we would be cautious on is export-facing ones like IT and pharma.
03:32Okay, thank you so much, Chakri.
03:35It's been a pleasure breaking this down with you.
03:39Investors, of course, at all-time highs, the nifty nifty bank and largely today driven
03:43by auto.