Rupak De, Senior Technical Analyst at LKP Securities, sees Nifty fluctuating between 20,500 and 23,500 in the calendar year 2024. "I don't foresee a double-digit growth in the index for the current year," he said. For Sensex, De mentioned that the index is likely to remain in the 68,000 to 76,000 zone. In an emailed interaction with Business Today, the market expert shared his views on the upcoming events that could have a potential impact on domestic equities. He also suggested that the sharp rally in PSU stocks is expected to take a pause in 2024 as investors pivot to other sectors. Here are the edited excerpts from the interview:
BT: What's your view on Nifty and Sensex for this calendar year? Can the domestic benchmarks deliver double-digit returns?
Rupak De: In 2023, Nifty demonstrated a commendable 20 per cent return, but historical trends suggest that such significant returns are often followed by a period of consolidation. Anticipating this pattern, I don't foresee a double-digit growth in the index for the current year. My expectation is that the Nifty will likely fluctuate within the range of 20,500 to 23,500 throughout 2024. Furthermore, Bank Nifty, which has already experienced a 4 per cent correction in the initial two months, is expected to underperform compared to the Nifty in 2024. Similarly, Sensex is likely to remain within the confines of 68,000 to 76,000 during the year. Several factors contribute to my cautious outlook for 2024. Firstly, potential delays or smaller-than-expected rate cuts by the Federal Reserve and Reserve Bank of India (RBI) pose a significant concern. Secondly, geopolitical risks may resurface sporadically throughout the year. Lastly, the impending elections in India and the United States could introduce additional uncertainties. Consequently, I anticipate a volatile year with limited gains or losses by the end of 2024.
BT: PSU stocks have gained sharply. Are there some counters which still have potential to shine?
Rupak De: PSU stocks experienced an extraordinary rally that persisted until the end of January this year. Notably, stocks like REC Ltd soared by an impressive 390 per cent, and numerous other PSU stocks surged by over 100 per cent, propelling investors' portfolios to new heights. However, the frenetic rally in PSU stocks is expected to take a pause in 2024 as investors pivot to other sectors. Despite the anticipated slowdown, the government's continued emphasis on power, modernisation of railways, and affordable housing projects is likely to sustain investor interest in PSU stocks. These ongoing initiatives could serve as key factors that attract investors to the PSU space, despite a potential shift in market dynamics.
BT: What would you suggest first-time or young investors to keep in mind while investing in the market? What kind of factors, including geopolitical challenges, trade, economy, upcoming elections, global supply chain challenges, should they keep in mind while planning market investments?
Rupak De: My suggestion to young, first-time investors would be to start by educating yourself on the basics of investing. Define an investment strategy and incorporate risk management, considering potential risks such as elections, geopolitical unrest, and changes in government policies. Additionally, it's crucial to learn how to interpret essential economic indicators to make informed decisions. Maintaining an adaptive and informed approach is vital not only for newcomers but also for existing investors in the dynamic world of investments.
BT: What do you think is a close-to-ideal kind of portfolio? A mixed one? How does one achieve that mix?
Rupak De: An ideal portfolio is a well-balanced investment mix tailored to an individual's financial goals, risk tolerance, and time horizon. Typically, diversified across various asset classes like stocks, bonds, and real estate, it aims to mitigate risk while maximizing returns. A long-term perspective, regular rebalancing, and consideration of market conditions are crucial. The portfolio's composition may evolve with changing economic landscapes, and generating income while ensuring liquidity are essential for resilience during market fluctuations. Individual circumstances and goals determine the perfect blend, and periodic review and adjustments are key to maintaining alignment with one's financial journey. Therefore, what is an ideal portfolio for one may not be suitable for another, as risk appetite, investment goals, age, etc., remain key deciding factors for an investor.
BT: Any particular stocks that you like at current levels?
Rupak De: From current levels, shares of Hindalco, Tata Steel and GSFC looked strong on charts. For Hindalco, one can expect a target price of Rs 580 with a stop loss placed at Rs 489. Tata Steel shares can be bought in the Rs 150-145 range for targets of Rs 165-180. For Tata Steel, keep stop loss placed at Rs 139. For GSFC, support level will be at Rs 215 and anticipated upside targets are Rs 240-250.
(Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.)