Don’t think the market is overbought: Prakash Diwan, Altamount Capital Management

In an interview with ET Now, Prakash Diwan, Director of Altamount Capital Management, shares his market outlook. Excerpts:

ET Now: What do you think is going to help us build on to the gains that we have already set up? Do you think that perhaps the correction now would be a little inevitable and maybe something that the markets need for a reality check?

Prakash Diwan: This hype on the market being an overbought zone is slightly overdone. We have seen the large cap stocks do extremely well on the back of perhaps improvement in the earnings environment and benign interest rate environment. Hence, you have the Sensex and the Nifty move to all-time highs, but that does not mean that the market is overbought.

What has changed dramatically is that the participation is now spreading across smaller cap and midcap companies. This is typical of a market which is very actively scouring for the next opportunity and the next round of opportunity is not going to be just a BGR or a Titan or a GMR or GVK. It is going to be newer stocks that have strengthened in the last three-four years of a downturn in the economy.

Thus, if you are stock specific, there is nothing wrong in investing money into the market and even on the large cap, buying on dips certainly has been the credo and it will continue for some more time till you have a real shift in the geopolitical environment. Unless some of those macro things get upset, I do not think we are in a stage where the market would see a very deep correction.


ET Now: Day after day we have been flagging off so many stocks from the boarder markets which sort of just start their uptrend and then have so much enthusiasm and resilience with the way they are moving, any offbeat, contra bets from the BSE-200 or the small cap end of the market that you would look at.

Prakash Diwan: Well yes one of the stocks it Tourism Finance Corporation which was one time a buzz with a lot of talk on the government’s move to push tourism, that is one stock that has kind of got sideline or completely ignored but it has lot of value, should start seeing some interest. The fundamentals are actually falling in place and other one on similar lines from the consumption theme is Kokuyo Camlin, the erstwhile Dandekar owned company called Camlin, all of us know that it is in a great area but has never taken off the way you would expect but I started seeing some volume (14:04) price action there in recent times and that could probably be again one of the buzzers in the market in the next few days.