10,000 new normal for Nifty; watch private banks for opportunity: Porinju

NEW DELHI: Dalal Street top gun Porinju Veliyath says 10,000 is the new normal for the Nifty50 and the domestic equity market has become very healthy after the painful correction through February and March.

In an interview with ETNow, he says domestic equities have become very rationally and reasonably priced and stocks will continue to be the best investment avenue for wealth creation in months ahead.

The domestic equity market had a roller-coaster ride in the first quarter of 2018. After rallying over 27 per cent in Calendar 2017 and another 1 per cent in January, headline indices Sensex and Nifty corrected over 10 per cent in the last two months.

Porinju said he is very optimistic, given the economic conditions in India. Although socioeconomic and political challenges are the key headwinds, one must be more rationale, realistic and optimistic in this market as there are all ingredients for that.

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According to the CEO of Equity Intelligence, his eyes are glued to the financial space, where he sees that well-managed private banks with reasonable or low NPAs can be good bets.

"Uday Kotak was talking about private sector banks gaining up to 50 per cent market share in next few years. This has a lot of implications on private banks, especially the well run, well-managed ones, be it midcaps and even largecaps,” he said.

“But not everything is cheap. Some of them are very much in the fancy and a bit stretched in valuations. So, you have to find your stock within the sector,” he added.

He observed that there are still a lot of grey areas in the public sector banks space. “We do not know how far they will get hit further. Amateur investors can avoid PSU banks at this point of time.”