'We may see a market pullback if...': A Lok Sabha election red flag from Marcellus' Saurabh Mukherjea
The small-cap meltdown saw nearly 13 percent disappearing from a peak in just over a month, leaving several investors puzzled if this was merely a correction or a sign of something bigger.
- Mar 18, 2024,
- Updated Mar 18, 2024 3:07 PM IST
Bourses may not have fully priced in the Lok Sabha election results and a lot will depend on how it holds up during the six weeks of voting from April 19, said Saurabh Mukherjea, founder of Marcellus Investment Managers.
Mukherjea, in a interview to NDTV profit, said a truncated verdict for the ruling government may trigger a 'broader pullback' which could see the small cap segment facing the 'brunt'. Mukherjea advised caution for small-cap valuations at this juncture, adding that one must look at "accumulating high-quality large-cap stocks".
The small-cap meltdown saw nearly 13 percent disappearing from a peak in just over a month, leaving several investors puzzled if this was merely a correction or a sign of something bigger, more so post Securities and Exchange Board of India (SEBI) chief Madhabi Puri Buch's warning of froth in the space.
Buch admitted that there are "pockets of froth in the market" which are like bubbles. "It may not be appropriate to allow the bubble to keep building, because when it bursts, they impact the investors adversely. That is not a good thing," Buch said.
The broader market saw nearly Rs 14 lakh crore getting wiped out on March 13. Though stress test results from mutual funds such as Quant and Edelweiss may have allayed some fears, worries of a deeper selloff in the segment remain.
Bourses may not have fully priced in the Lok Sabha election results and a lot will depend on how it holds up during the six weeks of voting from April 19, said Saurabh Mukherjea, founder of Marcellus Investment Managers.
Mukherjea, in a interview to NDTV profit, said a truncated verdict for the ruling government may trigger a 'broader pullback' which could see the small cap segment facing the 'brunt'. Mukherjea advised caution for small-cap valuations at this juncture, adding that one must look at "accumulating high-quality large-cap stocks".
The small-cap meltdown saw nearly 13 percent disappearing from a peak in just over a month, leaving several investors puzzled if this was merely a correction or a sign of something bigger, more so post Securities and Exchange Board of India (SEBI) chief Madhabi Puri Buch's warning of froth in the space.
Buch admitted that there are "pockets of froth in the market" which are like bubbles. "It may not be appropriate to allow the bubble to keep building, because when it bursts, they impact the investors adversely. That is not a good thing," Buch said.
The broader market saw nearly Rs 14 lakh crore getting wiped out on March 13. Though stress test results from mutual funds such as Quant and Edelweiss may have allayed some fears, worries of a deeper selloff in the segment remain.