Identify growth sectors early

He had made his mark with an early identification of the oil exploration sector and the software sector in the pre-Y2K era. He never looked back since. A veteran in the capital markets with over three decades of experience, he straddles the fundamental, derivative and technical arenas with equal ease.

  Before joining HDFC Securities, V K Sharma had stints with Canbank Financial Services and Anagram Finance. In the primary market, Sharma led and managed more than 75 public issues and underwrote more than 250 offerings. Besides his current responsibilities as head-PCG and capital market strategy at HDFC Securities, Sharma has all along been actively involved in research and investor education initiatives.

He thinks the economy is back on the growth path. “The worst is behind us and we have retaken our rightful mantle of the fastest growing economy. While we have emerged from the crisis, the world is facing the heat of change in the stance of the central banks and the mounting fear of global trade wars. This could slow the global growth, which is running at healthy 3.2 per cent for CY 2018. While domestic inflation has risen, it continues to be in a band which is acceptable to the RBI. GST collection figures have stabilised. We expect these to appreciably pick up after the E-Way Bill is made compulsory after April 1,” says Sharma.

That’s not all. Given that FIIs and DII have bought stocks worth Rs 9,000 crore and Rs 25,000 crore, respectively so far in 2018, Sharma believes some selling by the FIIs has been on account of the imposition of LTCG. And inflows, he thinks, should improve from April. 1. 

Trade war, he thinks, is also good for inflows as that will increase the attractiveness of India as its economy is led more by consumption than export. 

He also thinks the recent positive economic data, like GDP, manufacturing PMI, auto sales and growth in IIP, suggest higher earnings growth in the quarters ahead. While the Nifty earnings have grown at a CAGR of just 3 per cent in the last four years, the earnings will rise 14 per cent this year and by 25 per cent next year. As earnings rise, money inflows would also increase, he says.