Stock Shastra

Which sector should I invest in? Is this sector’s performance good or bad right now? What are the future prospects of a sector? These and many more such questions do cross an investors mind. Rightly so, since choosing the right sector to invest in, is almost as important as choosing the right company.

Therefore, our concept of Index@MRP! A few weeks back we started with a report on the FMCG sector. Today, our report is on CG@MRP index (Capital Goods sector). Is it over or under valued? What has been its past performance and what’s in store for the future?

Sensex & Nifty includes the top 30 and 50 Indian companies respectively and are amongst the most popular indices. However, sometimes investors overlook the mid-cap and small-cap companies which could possibly be the future large-cap companies and give you stupendous returns albeit at higher risk. In this article, Nooresh Merani talks about the mid-cap and small-cap indices which currently seem to offer attractive investment opportunities.

Of late, many have been talking about the Index and find solace in the fact that, Nifty and Sensex have fallen just 25% since 2008 or 2011 highs which is not really bad.
Everyone around the street is taking their best guess on where would Nifty/Sensex will bottom out. There are too many camps out there, some expecting 12000/3800, another at 14500/4500 and rest at 15500/4700 as to be possible a bottom.
My view has been 4500/14500 to be the worst in case, but would prefer to stop guessing the bottoms for the Index, I believe, we have already seen the worst in many of the stocks & are away by a mere 5-10% from the bottoms for many stocks.
I was surprised and astounded by the findings on analysis of data of past few years.
1) Majority of the Indices did not reach highs equivalent of 21k Sensex and 6.3k Nifty.
Bse Midcap is [...]

The Financial Year 2012 saw negative news continue to pour in for the market. Since the 19,000 level seen in March, Sensex has dropped more than 10% over the last two and a half months. The factors leading to this fall include inflation, rising interest rates and weak global cues. Inflation has been one of the key concerns for the Indian companies affecting earnings in the previous quarters. To tame the inflation, the RBI has continued tightening the monetary policy by rising interest rates.

So, how have the Sensex companies performed on the earnings side for the March quarter? And most importantly what action should you take considering the Sensex@MRP?

Defensive sectors are those that are known to fall less than the market as well as show less appreciation This is because earnings of companies from these sectors are relatively stable and predictable both in good times as well as bad.

But, a ‘defensive sector’ which has proven different is the Pharma Sector. While Sensex crashed by close to 55% (in the period Dec-2007 to Jan-09), the BSE Healthcare index dropped by around 34%. However, what has been surprising is that the BSE Healthcare Index has outperformed Sensex over the last 2 years registering a growth of 52% CAGR as compared to the 42% clocked by Sensex. Few companies that led this growth were Cadilla Healthcare, Dr. Reddy’s Laboratories, Ranbaxy etc.

So, how does the Pharma sector actually work? And what are the factors that will drive its growth? Also get a glimpse of the top players in this sector and whether they are worth investing in.