Positive bias for the Indian market will continue: Sudip Bandyopadhyay

"We will actually take cues from individual corporate related actions and data points like the Paytm board meeting on buyback. By and large the way I look at it, the positive bias for the Indian market will continue, "says Sudip Bandyopadhyay, Inditrade Capital.

The market is a tad bit volatile and lacks buying momentum. Where do you think it is likely to end at least for the month because December is usually a bit light when it comes to the entire buying action?
You are absolutely right. I think towards the end of December the market activity slows down and we know it is a holiday season. Historically, also it has been the case and after the central bank action is over there are no major macro triggers also left. Of course, we can always have some triggers coming as a result of the Ukraine-Russia war but that is not a certain trigger. The known triggers are getting exhausted after the FOMC and Bank of England ECB meet so we will be lacking triggers.

We will actually take cues from individual corporate related action and data points like the Paytm board meeting on buyback. By and large the way I look at it, the positive bias for the Indian market will continue.

Furthermore, we did end this week with a sharp cut of about 1% and there were some challenges in the IT post the HCL analysts call but by and large we maintain our positive bias and we think the markets will be range bound for the month of December. We will start to see momentum pick up from January again.

As far as the entire industrial basket is concerned, which company do you think is the best placed – Cummins, Siemens, defence companies, L&T take your bet?
The best one definitely is L&T and it is a very safe bet as well. L&T plays in multiple segments of infrastructure, construction, and hydrocarbons. The way their order wins has been, the way the private capex has picked up, I think L&T will be the biggest beneficiary of the order inflows as we know post COVID the execution has picked up pace and efficiencies have increased. Moreover, L&T has done away with many unrelated assets which were posing biggest challenges for the infra major and impacting its working capital and the return ratios.

So I think they are at the right place, at the right time and with the right balance sheet so I will go for L&T and I have been recommending investors to buy L&T for some time.

How do you see this move by Paytm? The stock was higher by 7% in Friday’s session. Is this a good move for wealth creation when it comes to the retail participation because the company is still loss making? Other than Paytm, which are the stocks that are on your radar?
Well as far as Paytm is concerned I do not know whether this is going to be a decisive move, as we know stock has corrected 76%. But the problem is that we still do not know the path to profitability and what business will give them the future growth. So we are operating pretty much in an uncertain environment.

Yes, the buyback probably will push up the share price to an extent and, of course, we will get to know a little more of this on 13th December. But as things stand, the company has just come into the market and within about a year’s time they are getting into a buyback, we do not know what their growth plans are, we do not know whether they will require further capital to support the growth or not. So it is a very-very confusing scenario. Yes the share price will get some support but I do not know about the future. I do not know whether one should go and start buying the company even for the long term. So I will continue to recommend investors to avoid Paytm.

As far as other sectors are concerned, I will quickly mention that the PSU banking pack should definitely be looked at. Friday’s correction, I think again, is an opportunity and investors who have a time horizon of at least till the next quarterly results, should plan to buy PSU banks.

Some of the PSU banks like Punjab National Bank have not moved up that much, probably it is a great time to buy. Our belief is that all PSU banks will come with a stellar set of numbers due to a combination of multiple factors including loan growth, asset recovery, asset quality improvement and a whole host of other such things and so buying into them will probably give the investors a bang for the buck.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)