Pankaj Karde,

Head-in­sti­tu­tion­al­sales&salestrad­ing, Sys­tem­atix Shares

Dalal Street Investment Journal - - COVER STORY -

Do you ex­pect the pri­mary mar­kets (IPOS) to suck liq­uid­ity out of the sec­ondary mar­ket in com­ing months?

The mar­ket is flush with liq­uid­ity and I don’t think that IPOS will suck out liq­uid­ity. The do­mes­tic in­flows are very strong and there is a short­age of good qual­ity stocks. The IPOS will en­able the funds to in­vest in new ideas.

Can you say that IPOS this year have re­vived the re­tail in­vestors' sen­ti­ments?

I can say that lack of other in­vest­ment av­enues have re­vived re­tail in­vestors' sen­ti­ments. Also, due to the bull mar­ket sce­nario, IPO com­pa­nies with good growth vis­i­bil­ity have re­ceived pre­mium val­u­a­tions. Not all IPOS have re­ceived block buster re­sponse. List­ing gains in growth com­pa­nies is the ma­jor rea­son for re­vival of re­tail in­vestors sen­ti­ment.

Are rich val­u­a­tions a con­cern for IPO in­vestors as well?

IPO in­vest­ment gives in­sti­tu­tional and long term in­vestors size­able in­vest­ment op­por­tu­ni­ties. Rich val­u­a­tions are not a con­cern if the com­pany can pro­vide good topline and bot­tom­line growth. Good com­pa­nies with good fi­nan­cials would con­tinue to get rich val­u­a­tions.

What are the key risks for the eq­uity mar­kets at this junc­ture?

The most im­por­tant risk to eq­uity mar­kets is slow­down in do­mes­tic flows. All geopo­lit­i­cal risks would be taken care of as long as do­mes­tic liq­uid­ity is strong.

Would you rec­om­mend IPO fund­ing for in­vestors?

I don’t re­ally rec­om­mend IPO fund­ing for in­vestors. IPOS which are good have seen mul­ti­ple times sub­scrip­tion, mak­ing IPO fund­ing unattrac­tive. IPOS which are any­ways not good should be com­pletely avoided.

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