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See Nifty in 8-9k range; capital flight on $ gain: ILFS

Vibhav Kapoor of IL&FS says the Indian market will start to look attractive once again in the 8200-8300 range. He believes Nifty can trade in the 8000-9000 range over the next few months.

The US Federal Reserve decision will be a key factor for markets – Indian as well as global, says Vibhav Kapoor of IL&FS. If in fact the Fed signals a rate hike, dollar will start strengthening, which is not good for emerging market equities, he says, as it may lead to capital flight.

In any case, Kapoor sees limited upside for the market, considering valuations are too rich. Coupled with the Fed move – if it raises rates – the Indian market can go sideways to down in the near-term.

According to him, Indian market will start looking attractive once again in the 8200-8300 range. He believes Nifty can trade in the 8000-9000 range over the next few months. 

He advises investors to reduce weightage on cyclicals and play the defensives – IT and pharma – instead as these sectors are likely to benefit on dollar appreciation. Kapoor does not wish to advocate midcaps at this stage and says large caps will lead the next rally.

Going by how things stand at the moment, he feels the first half of FY16 may not be as good for corporate profits. He sees things changing from the third quarter onwards and believes FY17 will be a really good year for corporate profit.

Stay tuned for more…

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