Markets Outlook and Investment Ideas for 2013

Kolkata, November 27th, 2012

Is this a good time to enter into equities? What is the market outlook for the coming year and the next 2-3 years? What are the sectors that we should bet on? Which companies look cheap at current valuations? These are some of the most sought after answers amongst the investor fraternity. IAIP at its Kolkata Speaker Event, held on November 27, 2012, was delighted to have the insights of Brahmaprakash Singh, Executive Director and CIO – Equity, Pramerica Mutual Fund, on the above questions.

Singh began by explaining the relative merits and demerits of Fundamental & Technical analysis, in stock picking. He explained the concept rather beautifully by drawing an analogy between a research analyst’s work with that of a prospective job applicant in a company.

He shared his concerns in two prime areas – on inflation at economy level, and gearing (leverage) at company level. According to him, inflation in India is here to stay. He expects significant consolidation activity in several sectors as the highly leveraged companies would be forced to re-organize themselves in the next 5 years. He believes that the start of the M&A activity is the best time to enter the markets, as there would be rapid increase in corporate IRR.

Brahmaprakash was of the view that monetary policy will continue to remain tight, though rate cuts would be inevitable given the amount of lobbying that’s going on. He believes that hike in retail FDI probably has vested interests and is unlikely a decision taken with the object of benefiting common man.

Singh was gracious enough to share two stock screening methods for the benefit of the audience.

1. Use of cash flow ROI
2. Comparison of Balance Sheet Loans with Total Assets

He ended the session by sharing a Trading tip, much to the delight of the excited audience.

About the speaker:

Brahmaprakash Singh has over 18 years of experience in broad based investment management, including portfolio management of equity schemes with a bottom-up investment style. Since August, 2012 he has been with Pramerica Asset Managers as Executive Director & CIO- Equity. From January 2008 to August 2012, he was the CIO at BCP Advisors Private Limited. From September 2005 to December 2007, MD & Portfolio Advisor at Atlantis Investment Advisors (India) Limited.

Contribution by: Abhishek Shah, IAIP Volunteer