Hitesh Parikh’s Final Call for 2014 – Market Realities and Targets

December 31, 2013

Hitesh Parikh’s Final Call for 2014 – Market Realities and Targets

Greetings from Hitesh! Please accept a big thank you for your responses to our emails. You are being replied individually. Now, let me deal with the market in 2014.

Our Approach:-

We have never based our investment decisions on GDP, Corporate Fundamentals, Expected Earnings or some upcoming news like budget announcements or election results. All of them can be manipulated and they are manipulated world over. Moreover, the person talking about them makes the most money (Media Analysts??) irrespective of you making money or not.

So, are there any right indicators? What are the ground realities which makes me confident about the market? Let me deal with them one after the other. In the first leg, we will see the sources of fund in 2014.

The Fund Flow in India in 2014:-

Money is the sixth sense….without it, you can not do much. So, let us look at the sources of funds in 2014 and why they will continue to bring more money in India?

World Scenario:-

Leading countries like USA, Europe and Japan are facing deflationary pressures and the politicians in those countries believe that by pumping more liquidity they can create more jobs / productions and economy can come back on the track.

I expect money printing to continue more or less at the same rate. FIIs have access to this free or cheap money. They will be eager to make the most out of this once in a life time opportunity. As such India is growing at 4.5 to 5%.....this is still more than world GDP growth rate of average 3.8%. So, India is going to have good fund flow in 2014 also.

Do not waste your time in listening or reading about FED Tapering. Japan has not been able to do it in last 24 years…..I do not expect US will also be able to stop it 100%. When it comes to FREE MONEY….USA is not THE USA.

Parliament Elections:-

This is another factor which will keep the fund flow alive. This will keep the rupee / dollar rate in a range with upward bias. We will not be surprised to see the dollar rate crossing all time high.

NRI deposits:-

NRIs did the major fund transfer in 2013. In fact, many followed our advice to transfer the funds between Rs.65 to Rs.67 and they are blessing us when USD touched our target of Rs.61. They made upto 10% without doing anything. In 2014 also they will keep brining money to India.

Domestic Factors:-

With the entry of AAP in the politics…..the equations are changing. All parties will try to do more good ahead of the elections. There competitions to outsmart other parties will surely bring in more benefits to the ground level people of India and the economy, directly or indirectly.

There is a possibility that AAP may contest elections on 500+ seats. In such a case the results will be very difficult. Looking at the plight of ground level people….AAP can easily win 100 seats. AAP’s win will be loss for Congress and BJP. AAP’s support will be the major role for the party forming the government at the centre.

In any scenario, we feel that politicians will be forced to be modest, humble and they will have to think about the people of the country. These alone will create positiveness in the Economy.

How Will Market Behave under above scenarios?

Market will be volatile. It will witness the positiveness on one day and negativeness on the other day. However, overall, we are in volatile bull market. Just take advantage of the same.

I have always shared the example of Bruce Lee. In Enter the Dragon, Bruce Lee had said, “Don’t think, feel! It is like a finger pointing away to the moon. Don’t concentrate on the finger or you will miss all the heavenly glory.”

If you waste time in talking about market, you will miss the money making opportunities of life time!! Do you want to miss?

Our Market Targets:-

We have been very categorical about our market target in 2014 since 2011. We are not changing the same. We maintain our upside Sensex target of 35000 in the most optimistic scenario.

I know the skeptic in you will say….can it go up from 21000 to 35000 in a year? To pacify the skeptic in you……just see the recent past…..from 9^th March 2009 to June 2009….Sensex went up from 9000 to 17000, up by 90% in less than 4 months.

In 2013…from low of 17250….it went up to 21000 + in just 2 months. With FIIs flow anything is possible.

We are revising our downside Sensex target from 15000 in 2013 to 17000 in 2014.

If the Sensex goes up, Will you make money?

When few companies are participating in the rally and the mass market is lagging behind….it will hardly make any difference in your portfolio if the Sensex goes up or down.

So, if you are under impression that when Sensex goes up, your current portfolio will be in super profit, you will feel dejected.

Here also you will have to be alert to the market. Bet on what market likes and not what you think market should like.

Which stocks to buy in 2014?

This is a part of our paid services. You need to become our member to know about the same. For your benefits, we are offering 50% discount in our fees. I suggest you take advantage of the same.

I thank you for being my regular reader and I appreciate your support in the past and expect the same going forward also.

Wish You All A Very Happy and Eventful 31^st Dec., 2013.  This date will never come again. So enjoy each moment of this day.

You can follow me @hiteshmparikh on twitter.

Live With Passion…Invest With Passion.

Hitesh Parikh.