Suman Bannerjee, CIO, Hedonova, sees Indian markets giving double-digit returns in 2023. In an interview with MintGenie, he stated that while the market sentiment and trends indicate a favorable trajectory, after the third quarter results, there is a possibility of a correction. He also added that the IPO market is a reflection of the general market trend and suggests staying away from IPOs now in case the markets reverse.
Edited Excerpts:
Indian markets have hit multiple new highs in the last one week; how long do you see this trend continuing?
Based on the current market conditions and momentum, I have a positive outlook for the NIFTY index, expecting it to rise in the coming months. The market sentiment and trends indicate a favorable trajectory. However, it is important to note that after the conclusion of the third quarter results, there is a possibility of a downward correction.
What factors can put a dent in this ongoing rally?
A weak rupee can have adverse effects on the market rally as it affects import costs and increases the price of imported goods. This can lead to higher production costs for businesses, reduced profit margins, and ultimately impact their financial performance. Higher inflation is another factor that can pose a challenge to the ongoing market rally
Do these multiple new highs mean a double-digit return for Indian markets in 2023? Or will it be muted like in 2022?
We’ll see double-digit returns in 2023.
Despite the recent rally, Indian markets have still underperformed global peers. Why do you think that is?
In 2022, Indian markets performed exceptionally well, and the positive momentum has carried forward. If we look at the performance over the last three years, it is very clear that India has actually outperformed many global peers.
The IPO market is back on fire! Any particular IPO you are looking forward to?
The IPO market is a reflection of the general market trend, I would advise staying away from IPOs now in case the markets reverse.
Is debt still a good option? Or should investors completely shift their focus to equities?
Holding a portion of one's portfolio in debt can still be a viable option. I would be 30% in debt right now.
What strategy should one use to buy more equities at all-time highs; or should investors wait for a bit of correction?
Investors should wait for a correction.
Apart from Equities, which other asset class would you advise long-term investors to invest in?
In addition to equities, I feel real estate in cities such as Mumbai, Raipur, Mohali, Cochin, and Hyderabad can be an advisable asset class for long-term investors. These cities have shown promising growth and development potential, making them attractive investment destinations.
After a spectacular 2022, PSU banks have not performed so well this year. Why is that? Do you see this trend continuing for the remainder of 2023?
PSU banks are cooling off after a stupendous year, they’ll underperform in 2023.
