The benchmark Sensex has gained 8.03% in Samvat 2074, while the broader NSE Nifty rallied 3.78%
A highly volatile Samvat 2074 ended on Tuesday with the BSE IT index turning out to be a star performer as it reported gains of over 37% on the back of depreciating rupee.
The benchmark Sensex has gained 8.03% in Samvat 2074, while the broader NSE Nifty rallied 3.78%.
Real estate and Smallcap stocks, on the other hand, turned out to be the major disappointments for investors, with indices representing the two segments losing over 15% since last Diwali on October 19, 2017.
Rahul Shah, VP – equity advisory group, Motilal Oswal, the private sector banks and IT did very well in Samvat 2074 with IT being the "star performer" for the year. Largecaps in IT has moved 30-40%, followed by the retail banks.
On the other hand, underperformers were oil & gas, especially oil marketing companies. Pharma also did not do well, along with midcaps. Oil marketing companies were down over 50% as all PSU stocks underperformed.
"PSU banks have underperformed big time. In October last year, all PSU banks were recapitalised, so all were up 30% and from there we are now half of it," Shah said.
In pharma, there was a re-rating of P/Es due to poor earnings and FDA issues, which pulled down the stocks.
A K Prabhakar, head- research, IDBI Securities, said the first half of coming Samvat 2075 is likely to be volatile due to state and general elections.
"Given today's Karnataka bypoll result, it may not be a cakewalk in the 2019 general election. Once the election is over, things will fall back in its place," he said.
According to him, non-banking financial companies (NBFC) stocks did well leaving the last two months, followed by auto, which did well in the first half.
"IT was the performer of the year," he further said, adding that the same rally may not continue in Samvat 2075 as IT and pharma stocks are linked to the developments in the US markets.
According to him, PSU as well as capital goods have underperformed. For the next year, however, Prabhakar expects private banks and PSU will perform well.
Meanwhile, in Samvat 2075, Shah does not expect the same kind of return from IT stocks. "May be 15% return from large cap IT companies will be decent, but the star performer is likely to be PSU banks," he said. According to him, all large corporate banks are showing recovery, and there is no further downside expected for PSU banks from here.
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On the other hand, underperformers were oil & gas, especially oil marketing companies. Pharma also did not do well, along with midcaps. Oil marketing companies were down over 50% as all PSU stocks underperformed.)
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