Large gains for indices, slim picking for investors
A sharp rise in the Nifty 50 index has been powered by a select group of stocks; most, however, are far from their 52-week highs
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Prefer us on GoogleLast Updated: Aug 12, 2018, 05:25 IST1 min
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Investors have watched from the sidelines as their portfolios, loaded with a broad selection of stocks in small- and medium-sized companies, have seen substantial erosion. The Nifty Midcap index is down 18 percent so far this year but still trades at a premium to the Nifty.
Leading the list of outperformers was Reliance Industries [which owns Network 18, the publisher of Forbes India] which saw a net addition of ₹1,49,667 crore to its market cap, making it India’s most valuable company. “With Reliance, we believe there could still be further upside,” says Abhimanyu Sofat, head of research at IIFL Securities. He points to the company’s pet coke gasification project that could take refining margins up in the next two years as well as Reliance Jio, which is on track to command a larger share of the mobile industry’s revenue pool. It stands at 16 percent and analysts have penciled it at 42 percent in their future projections.
Also among the top six outperformers are distressed corporate lenders ICICI Bank and Axis Bank. Both have moved to recognise non-performing assets more aggressively and the market is sensing the worst is over. In addition it is also enthused with the leadership changes in both banks. With retail lenders—HDFC Bank, Kotak Mahindra and Yes Bank—being thrice as expensive, the market believes the corporate lenders are due for a rerating.
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First Published: Aug 12, 2018, 05:25
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