Moneycontrol

India will become the bright spot of the world amid recession. Stay away from commodity banking and finance stocks. For the first time since 2008, there are signs of a recession. The dot com recession of 2000 had a limited reach. Most of the dot com tech companies were affected. At the same time, the 2008 recession was widespread. He had a situation like 1929. Veteran investor Shankar Sharma said these things during a special chat with CNBC-Awaaz.

In this conversation, he added that after 2008 the situation started to improve with the decision of the Fed. Inflation rose due to the Central Bank’s relief program. It will take time for market conditions to improve. Keep in mind that the previous bull market lasted 10-12 years. Similarly, the recession in America is also not expected to end soon.

Speaking on the Indian market, Shankar Sharma said that India will become an outperforming market in this recession. Indian markets fell less than the United States. The Indian market also ran less than the United States. Indian markets have moved less so will not fall much. Markets that have moved more also fall more. The Nasdaq had run a lot, so a sharp decline was also seen. However, during the market downturn, India will also be affected.

About the fall of the rupee, Shankar Sharma said that the currency and the crude are twin brothers. India’s problems increase with currency and crude. The weak rupee makes imports more expensive. We import raw materials. There is no negotiation in the import of raw materials. We export finished products. There is a negotiation price in the export of finished products. Margins are affected by price negotiation. There is a windfall in the export of finished products. The Indian currency is overvalued. With rising inflation, the import bill will increase, margins will also be affected.

What is the investment strategy? In response to this question, Shankar Sharma said that the China + One theme will benefit Indian businesses. Companies coming out of China are also coming to India. Stay positive on business with the China+ One theme. Do not hold stocks that are falling sharply in this recession. Invest in stocks that have failed. There is no future for Bank-Financials. Stay away from banking and financial stocks and commodities. The steel cycle never lasts long. Steel prices or consumption keep falling. Some small cap companies have shown better returns in 6-8 months. Get out of the bear market as the stock falls sharply.

Even in a falling market, these stocks, suggested by experts, can turn out to be incredible, can generate double-digit profits in 3-4 weeks

Don’t hesitate to exit with loss-making stocks. Risk management is essential in investing. Retail investors can earn more returns than MFs. Risk management is essential. Losses should be reduced. Continuous profit booking is essential in the market. Gradually recoup profits in stocks offering 50-60% returns. Profit reservation helps to make new investments.

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