The domestic stock market correction in the current year seems to have gotten the better of even ace stock picker Porinju Veliyath and the smallcap czar says that his portfolio underperformed the market in the first quarter of 2018. In an interview to CNBC TV18, Porinju attributed the underperformance to various bets on emerging companies and large bets. However, the top stock picker is not miffed, and advises investor to treat the correction as a buying opportunity.
Saying that it is a wonderful time for first time investors to invest in the stock market, Porinju told CNBC TV18 that domestic fund flows and especially savings from middle class families has just begun, and is likely to increase manifold going forward.
Sharing his outlook in the near-term, Porinju said that there may be more profit booking as the financial year ends, due to loss recognition. Further, he believes that the valuations seem to be reasonable, after removing the excesses. In his view, the stock market correction should not last for more than a week and capital markets will be back with inflows.
In a tweet yesterday, Porinju said that at least 20 million Indians are ready & waiting to invest in equities, for the first time in the country. “The current depression is a rare opportunity to part-own some of India’s solid businesses. Remember, ‘Discount Sale’ won’t be extended beyond March,” Porinju Veliyath said.
So where exactly should the investors look to invest? The ace investor expects to see a lot of traction in the insurance space. “Most of middle and lower class goes through a problematic phase when someone is sick at home. All their financials go into trouble. We are an uninsured country and hence this move is very significant,” he told CNBC TV18.
Apart from insurance, Porinju is also bullish on India’s consumption story and has considerable investment in Kaya Ltd. Porinju says that investors must be patient with this stock. In his interview, Porinju also spoke about VA Tech Wabag, a global firm for water treatment services. According to Porinju, the company is a global firm for water treatment services and look very attractive.