Buy Paytm? Let penny pickers stand before oncoming trains; don’t join them: Ajay Bagga

economictimes.indiatimes.com:

Ajay Bagga, Chairman, Elyments Platforms, says “wherever there is a compliance whiff also I think you are best served by sticking to the straight and narrow. If you want to take that kind of risk on smallcaps that is okay, on a 30-stock portfolio you say okay 2% or 5% I will risk on a couple of smallcap stocks but in a centre of plate or large companies to see governance issues or compliance issues, that becomes a very big red flag and especially in India. When you have so many alternatives, why go down that route?”

What is happening to the markets? We reached fresh high levels and then this sudden bout of profit booking comes in. Do you think we are close to the top for the year or at least for the first half of the year?
Ajay Bagga: Difficult to say that. But I think the big trend is that foreign investors have been selling as a cohort. Within that, there are different types of investors, of course. But FII selling is one characteristic of this market.

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Second, emerging markets have been hit by the Chinese market underperformance. So, as the Chinese market hopefully bottoms out and more flows start bending their way towards the emerging markets, we will also see a reversal of this trade, so that is the first thing. Second is that our valuations were never cheap.