Lok Sabha Elections 2024: Investors who are not overinvested should wait, says HDFC Securities' Jasani
Also Read- Elections 2024: Diversify portfolios to mitigate risk, focus on defensivesNervousness ahead of elections, approaching end of Q4 corporate results and diversion of funds to other relative cheap markets have resulted in this sell-off ahead of the election results outcome, said Deepak Jasani, Head of Retail Research, HDFC SecuritiesNifty quotes at ~21.5 times FY25estimated earnings per share and going by historical trends is currently at the top end of the valuation. Also going by the Market-cap to GDP ratio, Indian markets are at 1.4 times.
Indian markets are hence not cheap and are tilting towards expensive side, said Jasani. However the ensuing event (outcome of general elections) and the expectations built around the post Govt formation policy thrust and FPI inflows have led to these level of valuations.
In case these come out on expected lines and monsoon proves to be normal in terms of intensity and spread, Nifty EPS may be upgraded and then the valuations may seem more reasonable, added Jasani.Also Read- Lok Sabha election'2024: Stable outcomes and favorable pre-budget announcements could boost the markets- Anshul ArzareInvestors who are not overinvested in equities need not do anything (apart from some review and rebalancing) with their portfolio as this sell-off may seem minor in the big picture sometime later. Once the expected party/alliance gets sworn in and rolls out a series of policy announcements in the first 100 days, investors could return to the Indian markets.Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions Milestone Alert!
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