The first week of the New Year 2023 stood in favour of bears as negative global cues weighed market sentiment. The benchmark equity index BSE Sensex lost over plunged 1 per cent to 60,051 in the afternoon trade on January 6, 2023 against 60,840.74 on December 30, 2022. Likewise, the 50-share NSE Nifty index retreated by more than 200 points during the first five trading sessions of 2023.
Is the cautious start of the year hinting a more downfall ahead? Amisha Vora, co-owner and joint managing director Prabhudas Lilladher said that the New Year will be a story of two halves. The first half will continue to have the burden of rising interest rates, recessionary fears, the Russia-Ukraine war and their after-effects. Thereafter, we have to review whether there is any pivot from the central banks as far as interest rates are concerned. Thereafter, we need to reshape our investment strategy.
The market watcher sees a rangebound market in the ongoing calendar year. She believes that Nifty may trade in the range of 17,500-19,500 in the best-case scenario. “In case of any mishap globally the market may go down to 17,500 levels,” Vora said adding a rangebound market is a stock picker delight.
What to buy now?
In an interaction with Sakshi Batra of Business Today TV, the market watcher added that there are certain stocks, themes and sectors which will hugely outperform the market going ahead.
“Defence is the segment which will continue to do well because we see lot of onus is still yet to see. Execution of orders in the second half may start seeing into a lot of numbers in the companies. That is one segment which is not hugely owned at present. Traction is building in defence space and this will stay for the next 4-5 years,” Vora said.
She is also positive on the manufacturing and PSU sectors. While sharing her view on the beaten-down IT sector, Vora said that one should give reasonable weight to information technology stocks in their portfolio after the sharp correction in 2022.
On the new age stocks, Vora thinks that the extreme bubble is behind us. “Management knows that the unrestricted supply of capital is not going to be there. There will be a sharper focus on business models. I think that the growth will come down but profitability will start improving. I advised investors to wait for 2-3 quarters and see whether these business models are changing and turning profitable,” Vora said.
Considering the present market conditions, stocks like HDFC Bank, Hindustan Unilever, Max Healthcare Institute, Krishna Institute of Medical Sciences, Chalet Hotels, Lemon Tree, Kajaria Ceramics, APL Apollo, Westlife FoodWorld are some of her top stock picks for 2023.
Gold may add glitter
Diversification of assets is the key for the next 12 months. She said that investors should also give some weightage to gold in their portfolio. However, for equity portfolio, investors can give 50-60-per cent weightage to largecaps in their portfolio and the balance should be put in quality mid and smallcaps.