Even as the equity benchmark indices trade at record high levels evoking fear of a possible market correction, Sandip Sabharwal of asksandipsabharwal.com says that a deep correction from the current levels is unlikely in the near-term. In an interview to ET Now, the expert said that the corrective move is likely to be in the range of 200-400 points. Many market experts had cautioned that the markets may see a correction, if earnings don’t pick up in the current quarter. In an interview to BTVi, Harsha Upadhyaya, Head – Equity investments for Kotak Mutual Fund, said last week that strong earnings will be necessary to sustain the rally. Further, the market expert said that earnings growth will be in the range of 8-12% going forward.
However, this morning, Taher Badshah of Invesco Mutual Fund said that the earnings in the July-September quarter has been better than the last four quarters. In an interview to ET Now, Taher Badshah CIO (Equities), Invesco Mutual Fund said, “ One should dissect the earnings to see how many companies are actually over-delivering, or beating street estimates versus earlier. An analysis of the 35 companies of Nifty which have delivered results so far, 75% of them have actually beaten street estimates, or at least met them. This number was closer to 55% in the last four or five quarters. This is a better way to track earnings delivery versus expectation, and I believe on that front, things seem to be getting better.”
In fact, Taher Badshah says that Nifty could deliver up to 15% more in the next one year. “We will see better year on year growth numbers going forward. If we are prime for about 15% earnings growth in the next year, then over the next 12 to 15 months’ time, I would not be surprised if Nifty can deliver another 15 odd per cent in terms of returns,” Taher Badshah told the channel.