India ideas (Mar 29, 2021)

The market seemed ready to rollover just before the budget on Feb 1. But as the budget was being announced, there was a huge rally that spread across almost all sectors. #Nifty was up +4.7% and 2.6% on Feb 1 and Feb 2 respectively and made a recent high on Feb 16. Since then, it has been struggling to move back up and looks ready to roll over again.

Chart sourced from

Portfolio Allocation: Looking at the setups of some current leaders, I have a few test trades with small allocation right now. These will guide me whether to increase my exposure over the coming days and weeks.

Here is what I am seeing currently on the sector level:
Secular trends (leadership in 3m+ period) continue to persist in Software and Trading companies (eg, Indiamart). Most of the stocks in these sectors have been rangebound/declining for the past 3 months or so. Whether it is a time correction or a sign of an impending downtrend in overall market, time will tell.
New leaders have started emerging in Retail (eg. Vmart), Professional Services (eg. Quess, Teamlease etc.) and lot of re-opening related plays.
Financials drove the whole market up since November last year and are taking a breather right now.
Chemicals participated on the upside post Covid upto September/October and then lost leadership for 5-6months. They have started moving again in the last one month or so. So that’s another area to keep an eye on for the next run up.
Metals is another area which is grabbing global attention. Stocks (Hindustan Copper, Vedanta, Tata Steel etc) have a nice tailwind with the global inflation narrative. Some allocation in this sector with right risk reward would be advisable.
Cement companies seem to have a consistent bid as well. With re-opening, this sector is expected to contribute to growth in this fiscal.

Few names that look interesting right now for Long exposurein no particular order of preference:

Disclosure: I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Disclaimer: This is not investment advice, please do your research before committing capital.