It took 426 sessions or nearly 21 months for the benchmark NSE Nifty50 to reach the psychologically important 19,000 mark for the first time on June 28 from 18,000 levels, which it scaled on October 11, 2021. According to market watchers, buying by foreign institutional investors in the ongoing calendar year has supported the market. At the same time, regular incremental flow from systematic investment plans (SIPs), provident funds and pension funds also brightened the mood.
The 50-share index traded 179.80 points, or 0.96 per cent, higher at 18,997.20. Meanwhile, the index scaled an intraday high and low of 19,011.25 and 18,861.35, respectively, during the day.
Investments through the SIPs reached a record high of over Rs 14,000 crore in May against Rs 13,728 crore in April.
Dhiraj Relli, MD & CEO, HDFC Securities, said, “Nifty made a new all-time high on June 28, triggered by buying from institutions and retail/HNI segments. Improving US economic data and hints from China about fresh stimulus measures have helped improve sentiments.”
Mukesh Kochar, National Head-Wealth, AUM Capital Market, said, “Domestic institutions and mutual funds are becoming bigger and bigger. Post Covid, we have seen a very big change in most of the business houses. Most of them have created separate family offices and kept the business separate from those family offices. This money is huge and most of it is equity money. PMS and AIFs are growing heavily due to contributions from these family offices. Earnings in some sectors are also catching up and the June quarter is expected to be better. All these factors have supported the Nifty.”
“We believe that these flows will continue as India should continue to attract FPIs money due to its advantage compared to its peer emerging market economies like China, Korea, or Taiwan,” he said. Foreign portfolio investors have poured nearly Rs 60,000 crore into the domestic equity market so far in 2023.
Top gainers
Data shows that since October 11, 2021, more than 232 stocks on the NSE more than doubled investors’ money. Shares of Raj Rayon Industries have risen the most at 19,457 per cent to Rs 68.45 during the same period. It was followed by Servotech Power Systems (up 3,120 per cent), MK Proteins (up 1,294 per cent), Hilton Metal Forging (1,253 per cent), Network People Services (up 1,059 per cent) and KPI Green Energy (up 1,044 per cent).
Focus Lighting & Fixtures, Bombay Super Hybrid Seeds, DU Digital Global, Pulz Electronics, Global Education, Latteys Industries, Bodhi Tree Multimedia, SecUR Credentials, Spacenet Enterprises India, United Polyfab Gujarat, Brand Concepts, Shubhlaxmi Jewel Art and Madhya Bharat Agro Products also gained somewhere between 500 per cent and 1,000 per cent during the same period.
The road ahead
Kochar further added that a very small percentage of Indians are in the stock market or financial investors at this point. This number will keep on increasing and the kind of retail money that can come in the future is out of imagination. “So by and large we are bullish over the long term. There are still huge pockets of opportunities in the market. But having said that, one should always know that the market is always volatile in the short term and small corrections are always expected. Investors should focus on asset allocation rather than timing the market and look for the bigger picture in the long term,” he said.
Relli said, “Upside momentum could take Nifty even higher from here and if the El Nino fears subside, we may see a more sustainable up move. India shines as an attractive destination for investors from across the globe offering steady growth, falling inflation, better external trade/services situation, improving corporate earnings trajectory, prudent growth-enhancing and fiscal policies.”
Stocks to buy now
Considering the current market conditions, Amar Ambani, Head-Institutional Equities, YES Securities, is bullish on Reliance Industries and Bharti Airtel among the big firms. “RIL is reaching a stage where the phenomenal value of the retail business will fetch you all other businesses (Oil & Gas, Refining, Petrochemicals, Green Energy, Fuel Stations, Telecom) virtually free, at the current price. The stock has largely underperformed the Nifty benchmark for nearly three years now. Once this consolidation ends, we could see another major up move,” said Ambani. He further likes ICRA, Polycabs and Apollo Pipes, among others.
On the other hand, Sandeep Raina, Head of Research, Nuvama Professional Clients Group likes Ador Welding, DLF, Brigade, Mahindra CIE, Mastek, HSIL and Metro Brands.