NSE Nifty 50 is finding it difficult to surpass its all-time high of 18604 due to the rich valuations. However, if 18600 is breached, NSE Nifty 50 may move towards 19000 or 19300, Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, said. The 50-stock index hit a fresh 52-week high of 18442 in intraday trade on Wednesday. In an interview with Surbhi Jain of FinancialExpress.com, Shrikant Chouhan said there is a limited scope for equity benchmarks – BSE Sensex, NSE Nifty 50, and Bank Nifty – to move higher by end of this fiscal, and advised investors to keep an eye out for BFSI, Capital Goods and Real Estate sectors from a near-to-medium term perspective to pocket gains. Here are the edited excerpts from the interview.
1. Where do you see Sensex, Nifty and Bank Nifty by the end of this fiscal?
At the end of this financial year, with current earnings (EPS 815 FY23E and EPS 946 FY24E) and macro factors, we feel there is a limited scope to move higher. However, if we see some downside in the dollar index and crude oil prices then chances to reach 19300 would get better. For that, we need to maintain the dollar index below the 103 level and Brent below the $90pb level.
2. What do charts say for Nifty 50 and Bank Nifty in near-to-medium term?
Technically, the markets are finding it difficult to cross the 18604 level which is the all-time high for the market mainly due to the rich valuations. However, on the dismissal of 18600, we are expecting the market to move towards 19000 or 19300 levels. For Bank Nifty, 42800 is the key level and above it, the chances of reaching 44000 will brighten. On the downside, 17500/17600 will be the support zone for Nifty, and 40000/40100 will be the support area for Nifty Bank.
3. Are there any particular sectors that investors should keep an eye out for?
BFSI, Capital Goods and Real Estate should do well with a 3-to-6 months perspective.
4. What according to you could be the dark horse in the current stock market scenario?
We feel, Financials should do well, however, the dark horse could be the IT index, but, for that, we need furthermore improvement on the macro factors. We need a fall in the dollar index and a decline in the 10-year bond yields of the US.
5. Where in the market, in your opinion, should investors book profit?
It is advisable to keep taking profit till the NSE Nifty 50 index is below the level of 18600.