2017 will be a year of stock pickers: Porinju

[Ravi]

Even though most global brokerage firms have cut their year-end targets for the benchmark equity indices, Porinju says investors should not take those numbers very seriously.

"They (global investment banks) are just doing their 'job'. Ignore the Sensex and Nifty50, stock picking is the name of the game!" he said.

Sectorally, Porinju feels select infrastructure companies would do well in the emerging new economic environment.

He is bullish on consumption stocks which have been beaten down due to demonetisation. "Short-term negatives of a great long-term business can be a good opportunity for smart investors," he explained.

Porinju maintains his bearish bias on gold. "The precious metal will be at the same price or below it after five years. I don't know about 2017. I had tweeted my bearishness on gold a month ago at around $1,300 an ounce," he said.

The household savings, which entered the Indian equity market in 2016, are huge. Mutual funds recently crossed the Rs 16 lakh crore mark in asset under management as the number of SIPs has almost doubled in the recent past.

"Indian households are becoming whiter, wiser and smarter," Porinju said. "You will be surprised to see the fund flow into Indian equities from domestic investors in 2017 and 2018. Inflows to monthly SIPs will cross Rs 25,000 crore in two to three years," he said.

And one advice Porinju Veliyath would like to share with his investors for calendar year 2017 is to maintain discipline and simplicity in approach while investing.

Allocate some part of your wealth to the poor and be a good citizen, invest some in debt, while half of your wealth should be in equities to achieve your big dreams, he said in an interview with ETMarkets.com.

The domestic equity market failed to cheer investors in Calendar 2016, but next year promises to be different and is widely expected to reward investors.

Investors, who want to start afresh with small capital or have accumulated funds and now want to diversify, should not ignore the equity market.

Porinju says investors who have funds should also do their bit to help society and allocate some part of the investible wealth to help the poor.

According to Porinju, age is really no bar, when it comes to wealth creation. "There is no hard and fast rule in this regard. It depends on the prevailing economic environment and market opportunity," he said.

"If you have one million rupees as investible surplus, keep 10 per cent of it to help the poor and underprivileged. Another 40 per cent should go into fixed income assets and the rest 50 per cent into equities," said the MD & Portfolio Manager at Equity Intelligence India.

"Calendar 2017 is most likely to see a bull market in equities. Genuine long-term investors should not be disheartened by the bruises of demonetisation. It is part of a crusade against corruption and black economy," he said.

The much-required war on corruption will lead to significantly improved socio-economic progress in the country. Demonetisation is good for listed companies as they are organised businesses, he said.

Source: ET