Interview :: Equity market heading to better times, says Sunil Singhania

May 16, 2014, 09.54 PM IST | Source: CNBC-TV18
According to Sunil Singhania, since Indian got a single majority party after 30 years, investors are expecting a lot of surprises going ahead.
SUNIL SINGHANIA Head – Equity, Reliance Mutual Fund

After Narendra Modi-led BJP exhilarated India with a clear majority of nearly 280 seats, Sunil Singhania, Head of Equities, Reliance Mutual Fund believes the country is heading to better times.

According to him, since India got a single majority party after 30 years, investors are expecting a lot of surprises going ahead.

A near-term move of 10 percent either up or down is likely to continue for another day or two, he adds.

Below are excerpts from the interview:

Q: We have seen quiet a bit of volatility, but this is the best market wanted, what is the way forward now? Do you expect some profit booking at these levels or do you expect fresh set of investors to come in now and the market may go to higher levels?

A: There are very few investors who would be sitting on profits because they have been ignoring the market for long. Having said that, near-term moves of 10 percent upside and correction will continue for another day or two. Look at medium-term, short-term as well as long-term with a lot of optimism.

There were so many things which were stuck for a variety of reasons for the last couple of years and we were discussing that this is the best mandate in our life, its in the professional life, we have never had at least as an investor, a scenario where a single party had majority, so we are looking at this with a very different view, things can surprise or keep on surprising more and more as we move forward. So, irrespective of what happens today or tomorrow, our view is that we are heading for better time.

Q: You are a fund manager and so you would advice retail to enter via mutual funds but in terms of portfolio rotation or portfolio allocation if someone has to invest on his own, what would be the best advised?

A: First get convinced about equity. If you are invested in equity at least you will make equity returns, sector preference might increase or decrease returns by 1-2 percent but ultimately the asset class selection has to be right.

As an investor or as India, we are only 1-2 percent invested in equity, I think asset allocation has to be right, so my immediate advice to investors would be to get the asset allocation right and then invest in equity. The next question would be then in which sector or which stock do you invest. So, first the asset allocation itself has to be right.

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