From the Managing Editor

In our cover story, we bring to you strategies adopted by some celebrated investors - Warren Buffet, Benjamin Graham, John Neff and David Dreman - to pick value stocks.
Sarbajeet K Sen/Money Today        Print Edition: August 2014

The equity market has been on a roll in recent months. There has been a sharp move upwards with the BSE Sensex gaining nearly 5,000 points since the beginning of the year. On July 7, the Sensex closed at its all-time high of 26,100. On January 1, the index stood a 21,140. Its lowest point this year was 20,366 on February 14.

Expectations from the new government at the centre are high and the equity market is likely to maintain its uptrend in the medium to long term and can test fresh highs. Amid the soaring broader market, there are a whole lot of individual stocks that have registered sharp rise in prices.

In the largecap segment, top gainers since January 1, L&T and Axis Bank and Hindalco, have all given returns of over 50%, with L&T topping with 58% gains. The mid- and small-cap segments have been a step ahead. Amtek Auto and PMC Fincorp in the mid-cap segment have risen 224% and 207%, respectively, while the top gainer among small-cap stocks, Greencrest Finance, has given a massive 1,179% return, followed by Ahluwalia Contracts at 412%.

Are you looking to buy in this market? If you are someone who is looking for discount buys, the present market levels can act as a dampener. It could be a daunting task to spot value in a market that has shot up sharply.

However, equity markets always provide opportunities to create wealth. There would be stocks that have escaped the market's eyes that are available at a bargain. The question is how to spot these value buys?

In our cover story, we bring to you strategies adopted by some celebrated investors - Warren Buffet, Benjamin Graham, John Neff and David Dreman - to pick value stocks. We did some filtering ourselves based on the prescriptions of John Neff, known for his value investing skills, to get you some stocks in the current market that still hold value for investors. However, this comes with the rider that equity investment always has risks associated with it.

The first budget of the Narendra Modi-led National Democratic Alliance (NDA) government has given relief to the taxpayer with higher exemption limits, increased deduction limits under Section 80C and higher benefits on interest paid on home loan. All these could result in reasonable tax savings. In our budget package, we tell you exactly how the various direct tax-related announcements will impact persons in different tax slabs.

You will also now have some new instruments to invest your money with the revival of the Kisan Vikas Patra and the launch of a special savings scheme for education and marriage of the girl child. Tax incentives to float Real Estate Investment Trusts (Reits) that aim to gain by investing subscriber money into real estate will provide another investment vehicle. Read on to know how to benefit from them.

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