Investing in a Bull Market: Where to Put Your Rs 10 Lakh

Ajit Mishra, SVP, Research, Religare Broking shares cues on where to invest Rs 10 lakh in this bull market, citing opportunities in cement, renewable energy, and consumer goods.

Bull MarketInvestment StrategyReligare BrokingLarge Cap StocksMid Cap StocksSmall Cap StocksRenewable EnergyConsumer GoodsInfrastructure DevelopmentElectric VehicleBudget ExpectationsReal Estate PuneJul 01, 2024

Investing in a Bull Market: Where to Put Your Rs 10 Lakh

Real Estate Pune:The Indian stock market has been on a roll, with the BSE Sensex gaining nearly 9% in the first half of 2024. While mid- and small-cap stocks have outperformed, their valuations now look stretched. So, what's the right strategy to make money in this market? Ajit Mishra, SVP, Research, Religare Broking, shares his insights on where to invest Rs 10 lakh in this bull market.\n\nMishra believes large-cap stocks have more reasonable valuations, drawing investor interest. He expects fund flows to shift towards large-cap stocks as investors seek stability and better valuation opportunities in an increasingly volatile market. In the medium- to long-term, he targets 25,600 for the Nifty and 84,500 for the Sensex.\n\nFor sector-specific investors, Mishra suggests focusing on renewable energy, driven by robust government initiatives, sustainability goals, and significant investments. The consumer goods and retail sectors are also beneficiaries of rising disposable incomes and urbanisation. Infrastructure development is another strong theme, with the government focusing on projects like transportation networks, driving growth in construction and engineering.\n\nIn the electric vehicle (EV) sector, Mishra sees rapid expansion due to increasing environmental concerns and supportive policies, benefiting manufacturers and battery technology companies. He is bullish on stocks like Birlasoft, Dalmia Bharat, ITC, and Titan Company, citing their strong fundamentals and growth potential.\n\nSo, where should you invest Rs 10 lakh? Mishra recommends allocating Rs 7-8 lakh to the equity market, focusing on large-cap stocks for stability and lower risk. The remaining funds can be invested in mid-cap and small-cap stocks, which offer higher growth potential despite increased risk. This strategy balances stability with growth opportunities, optimising the risk-reward ratio for the investor.\n\nLooking ahead, Mishra expects the upcoming earnings season to present mixed results due to election-related uncertainties. Sectors like infrastructure and capital goods could be significantly affected by the lack of new government-related tenders. However, defensive sectors like utilities and FMCG are expected to remain resilient while IT may post mixed numbers.\n\nIn terms of the Union Budget 2024, Mishra expects significant fiscal measures to boost economic growth, enhanced infrastructure spending, and incentives for key sectors like manufacturing and infrastructure. He also anticipates reforms to attract foreign investment, steps to simplify the tax regime, and increased focus on sustainability and green energy.

Frequently Asked Questions

Where should I invest Rs 10 lakh in this bull market?

Allocate Rs 7-8 lakh to the equity market, focusing on large-cap stocks for stability and lower risk, and the remaining funds to mid-cap and small-cap stocks for higher growth potential.

What are the key sectors to focus on in this market?

Renewable energy, consumer goods, and infrastructure development are strong themes, driven by government initiatives and sustainability goals.

How will the election-related uncertainties impact the earnings season?

The upcoming earnings season may present mixed results due to election-related uncertainties, with sectors like infrastructure and capital goods likely to be affected.

What can we expect from the Union Budget 2024?

The budget is expected to include significant fiscal measures to boost economic growth, enhanced infrastructure spending, and incentives for key sectors like manufacturing and infrastructure.

How do I balance stability with growth opportunities in my investment portfolio?

Allocate 70-80% to large-cap stocks for stability, lower risk, and steady returns, and the remaining 20-30% to mid-cap and small-cap stocks for higher growth potential.

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