Oil & gas will take Nifty to new highs in coming weeks: Prakash Diwan

In an interview with ET Now, Prakash Diwan, Chief Portfolio Strategist, Prakash Diwan's Wealth Circle, talks about the ,arket and shres his stock specific strategies. Excerpts:

ET Now: The market is trading with the shade of green. Are we looking at previous highs being challenged on Nifty and Bank Nifty next week?

Prakash Diwan: I do not see any reason why that would not happen. The only thing that could upset the applecart would possibly be earnings. If we get some earnings particularly from PSU banks and if there is some disappointment, market could again start questioning and Bank Nifty could loose some steam.

However, oil and gas as a sector will contribute significantly going forward for Nifty's next big up move and we should be able to scale some news highs in the times to come particularly in the next couple of weeks.

ET Now: How are you looking at the telecom space? CLSA has come out with a sell call on Reliance Communications. How do you see the stock because it is gaining despite of weak results and a negative brokerage call?

Prakash Diwan: It seems a contrary move. The exceptional profit they have clocked has kept the stock in the green. Operationally, the company has seen a set back in terms of market share and has lost to Bharti and Idea. Going forward, it will get difficult and that is probably why CLSA has been prompted to downgrade the stock from a longer term perspective.

The likelihood of Reliance Jio going ahead with its advancement plans in terms of launching the 4G business and if that were to happen, they will have to rely heavily on somebody's infrastructure. By default that is will be Reliance Communications. Therefore, there is not a lot of news flow that the market is expecting. The stock can go higher in terms of anticipation rather than real numbers.

ET Now: From this entire pharma pack, which one would you pick from the large cap space?

Prakash Diwan: From the large caps, Lupin seems to be on a roll. The momentum seems to have just started much later than what we saw in terms of the other players like Sun Pharma, Ranbaxy and others. Therefore, Lupin should possibly peak at the right time in terms of the market also peaking. There is a lot of under ownership relative to the other stocks especially when we compare it with Ranbaxy and Sun Pharma. Therefore, that has a lot of headroom left.