Indian Share Market - VSRK Capital | Trusted Mutual Fund Distributor & Financial Advisory Services

September 4, 2021

WHAT NEXT WHEN MARKET TOUCHES 17K

The Indian equity markets have ended on a record high. The 30-share Sensex rose 514 points to end at 57,852 while the 50-pack Nifty settled at 17,234, up 158 points. This has led to many of the readers and investors wondering, what next?

It’s simple really! VSRK has always maintained that successful investing depends more on ‘Time in the market’ as opposed to ‘Timing the market’. While valuations and prices are absolutely significant, it is more important for investors to spend time with high-quality businesses than time their ups and downs. Around 50 stocks that have rallied over 500% in the last few years bear testimony to this.

The questions still remain unanswered: Is the market going to rise further or is it going to fall? One should be a pessimist and wait or cheer up and invest right away?

Waiting for a market correction to start investing would result in a loss of opportunity. This is the only reason why one should get going ASAP. If one will wait for some correction, surely will stay dwell. Therefore, one should invest. Even at a market high, the markets are only going to go higher in the long-term orientation. One can expect a few jerks on the way, but the general market course is going to be largely upward-looking. But remember, Investing should be played for a long-term.

Step #1: Avoid the temptation of booking profits!

Equity as an asset class is habitual of giving superior returns in the long term due to the power of compounding. VSRK insists & helps in cutting the losses short and riding on winners. This selling rule is deeply embedded in our policy. You should always have an investment plan and remain disciplined.

Step #2: Asset allocation is important

The fact remains intact that market volatility affects your portfolio’s asset allocation. It could be possible that your portfolio is composed only of small-cap or mid-cap stocks. In up trending market, a concentrated portfolio may increase chances of loses. One should diversify when the markets are really high. Diversification means flexible market capitalization. The best way to keep your portfolio up to date is by utilizing an active investment strategy such as VSRK.

Step #3: Get rid of under-performing investments

When you initially constructed a portfolio, markets must have been quite different. Now that considerable time has elapsed, chances are that the valuations have changed. The reasons that made you buy those particular stocks might no longer exist. The market leaders might have changed ranks. In such a situation, sticking to laggards can result in losses. So, use this time to review your entire portfolio and weed out stocks that don’t seem valuable anymore.

Step #4: Invest according to a proven investment strategy

It is rightly said that a plan without a strategy is merely a vision. Investing in accordance with a strategy can help you achieve your various financial goals and understanding your risk appetite will keep you away from making impulsive or ill-informed investment decisions based on greed and fear. VSRK is a smart investment strategy that is complete with selling rules and can help you invest in accordance with your risk appetite.

Step #5: Consult your Investment Advisor

The art of investing includes doing the basics of investing right i.e. knowing how much to invest for your goals, where to invest, understanding your risk appetite, proper asset allocation and re-balancing, investing systematically and remaining disciplined in your plan irrespective of market conditions.

An investment advisor can not only help you understand your financial objectives but will also help you curate your equity portfolio in order to achieve those objectives. An advisor will act as a guiding light in navigating your way through the volatility of financial markets.

All said and done, market highs and market lows shall come and go. The volatility shouldn’t bother long-term investors. You should always aim to keep an eye on your goals and invest in a systematic manner. VSRK would be delighted to assist you in your investment journey so that you can fulfil all your financial goals.

September 2, 2021

How to Invest without Knowing the ABC’s of Investing ?

Calm down, you are not alone, in the universe who is so uncomfortable with investing money in today’s glowing market. Like many other individuals, still following traditional methods of savings even when many of us there are becoming successfully wealthy in the market. Well, let’s discuss how to cope up with the fear for trading the new transparent and amazing products blossoming in the ocean of financial markets today.

The fear of entering the new world of commerce at any course of your investment life, can immensely affect one’s investment choice. Investing is scary because returns aren’t guaranteed. Hesitant investors following the psychological approach of the fear of losing money in the stock market.

People prefer avert losing anything they possess, relatively take a risk to make a big fortune. It’s human to hate losing more than liking to win, and hence, psychology says to ‘play it safe’ when it comes to monetary. Fear is keeping people outside the investment world and potentially away from reaching their long-term financial goals.

We agree that the investing world is cluttered with technical terms and difficult jargons. To remove this hesitation, VSRK brings to you accessible tools and hands on expertise to help you understand the basics, decode the difficulties and make informed decisions.

The market is based on the sure shot formula of “taking the right decision at the right time”. One can certainly earn a good return out of the investments made with correct decisions at the perfect time. Saving early and investing regularly is vital key to financial security and reaping success. More likely to afraid to invest money increases the possibility of losing the track on profits from the market.

VSRK firmly believes that before investing your money into the market, we make sure that the investor should understand the detailing about the market as per your financial goals and targets.

VSRK provides required beneficial market tips about why and where money is invested. So, seek help to invest your money wisely. Beware of the fraudulence or fake guides & suggestions.
The more you know, the better you’ll feel about investing.
Bottom line, investing your money in market is a rewarding way to grow your wealth over time than using a traditional, low-interest savings schemes. And that’s why we are here to guide you with our experts. From dreaming about buying a car to retirement planning to planning a dream vacation or buying a home all need funds. And someone has said that “It takes money to make money”.
You are investing but do not realize it. Your fixed deposits or post offices saving are further invested somewhere for a good return but you are getting fixed meagre interest. Many have the tendency to think that only rich people can invest. No, you just need to have some money to invest. With VSRK application, you can start with as low as little as Rs. 1000 per month.

One should avoid to get scared from unfamiliar terms. The financial assets are risky but they tend to outperform most of the time in long run. I always tell new investors, “Risk and return are married, and they’re never going to get divorced”. There is no return without risk. Bonds on the other hand are less risky investments than stocks.

Don’t square off to mingle investing and gambling at same level, think again. When you put your money in a range of different investments say in a mutual fund or an index fund, which hold many different individual stocks one can reduce the risk of losing money.

The fact is investing doesn’t makes anyone rich overnight. Just as food takes time to cook well, similarly investment takes time to grow into wealth. A common saying is that it’s about time in the market, not timing the market. In other words, over time, your money grows when you invest it.

VSRK’s experts helps you diversify your hard earned finances across different investment among many sectors which mitigates risk. The markets have both good and bad days. We don’t react impulsively but act wisely to extract the potential rebound of the market.

August 18, 2021

What are Multi-bagger Stocks in India | Multi-bagger Stocks 2021

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What are Multi-baggers?

Multi-baggers are sprouting small caps or mid-caps that have the flair to grow into large-cap stocks thereby enriching investors with mounting returns. These stocks have the potential to grow at a remarkably higher rate than large-cap stocks.

Why should one invest in Multi-bagger?

Investing in a prospective multi-bagger stock will give you the opportunity to grow your wealth monumentally. These stocks represent blooming companies with an exclusive product or service with high potential desire from the clients. Once the product or service is incorporated, demand can explode resulting in a sharp rise in stock valuation.

How much time it takes?

Cashing in on from multi-baggers requires patience and methodical to stay invested. Proceeds from such stocks are as straight as arrow, i.e. these stocks usually competent of high price volatility and on forming a base, the price rise is usually swift. In brief, VRSK Multi-baggers have a holding period of around 2-3 years.

What is the potential Gain?

As the name suggest, multi-baggers are stocks which multiply the investments value. VSRK Multi-baggers offer a potential upside of 80%-100% in a period of 2-3 years.

Do Multi-baggers involves risk?

Multi-baggers are perilous if one invest without adequate research and loosely examine these stocks. This is what VSRK does for you. Embryonic multi-baggers are picked after rigorous research and analysis and are tracked to assess any potential change in the position of the company or any micro/macro breezes. Diligent selection

And continuous monitoring significantly minimize investment risk in such stakes. These stocks go through price volatility which one must be prepared for in order to catalyze blooming wealth from such stakes.

How multi-baggers are chosen?

Finding a virtuous multi-bagger involves a meticulous process of comprehensive and insightful research across the entire orbit of stocks falling in this basket. Every VSRK multi-bagger is chosen after analyzing various factors which include company valuations, the background of promoters & their holdings, corporate governance due to diligence, management efficiency, industry trends and economic policies.

Models of stock Selection

Management Quality

Corporate governance
Highest ethical standards
History of wealth creation
Corporate Governance
Alignment of interest
High Ownership
Attitude of rewarding minority shareholders

Opportunity size

Robust Business model
Large opportunity size
Scalable – Without changing the business model
Huge Profit Pool – Scope and potential to earn many times its current profits.

Superior product and services

Leading products or services
Competitive edge
Moat
Ability to gain market share

Financial Discipline and Efficiency

Capital allocation
Superior Cash flows Profile
Return ratios
Clean balance sheet – Avoid leverage
Efficient working capital management

With the Multi-bagger Stocks, You:

Invest in both growth & value stocks with strong fundamentals.
Own a Tax-efficient portfolio.
Have a low churn portfolio with systematic rebalancing
Maintain a diversification of 15-20 open positions
Set a time horizon of up to 3 years

“We go all the way with our business & Industry Legwork”

Our research seeps through beyond the stock analysis into the core business and the intricate details of Industry dynamics. This allows us to estimate the bigger picture when it comes to these Gems.

August 10, 2021

What is Grey Market?

The gray color affects the mind and body by causing unsettling feelings. Hence the gray (grey) market can be coined as an off the record market for the securities where trading eventually occurs when a stock that has been hanged down from trades off the market, or when new securities are asked and bided before official trading begins. The gray market enables the issuer and underwriters to estimate demand for a new offering because it is a “when issued” market (i.e., it trades securities that will be offered in the very near future).

Characteristics of gray market:

This market in financial securities is considered as unofficial for over-the-counter (OTC) transactions.
Unlike classical OTC trading where securities don’t trade on an exchange, the gray market trades in financial products which have been hanged down from formal trading, or we can say those have not started an official trading.
The gray market can be coined to the products, generally imports which are sold through substitutional retail channels.
In any case, though not illegal, the informal status increases the riskiness of this market.

Unlike black market, in gray market binding trade, transactions cannot be settled until formal trading begins. This may lead a crafty party to reverse on the trade. Due to this uncertainty, a few institutional investors, like pension funds and mutual funds, may not participate in such kind of a trading.

The gray market for products flourishes when there is an important price disparity for a famous product in different countries. In various countries, there occurs a marked gray market for popular consumer goods as these can be purchased online and shipped to any location in an easy manner. Pharmaceuticals, Luxury cars, cigarettes, high-end apparel, cosmetics, handbags and shoes are such other examples. Informal dealers may import such items in bulk and, adding a healthy margin, they do sell them at a price below the local cost to increase market segment.

Post-sale service and support is another vital issue, as authorized dealers may not service goods bought in the gray market.

Consumers may also occasionally unintentionally buy a gray market product. Major possibility that a product is from a gray market are a price that is considerably lower than that offered by other local retailers.

Impact on Businesses

The size of gray markets is important. Business done other than official channels poses challenges for the manufacturers of the goods. Other than from the loss of sales booked directly by a company, it also produces a risk to brand equity and damages healthiness of the official sales channel ranging from wholesalers to retailers, whose forte for sought-after goods is curtailed.

July 4, 2020

How is the Indian Stock Market Reacting to the Coronavirus Impact?

Impact of Covid 19 on the global markets

In the past few weeks, the stock prices have fallen drastically and the market saw a downfall of nearly a third of the global market cap. The whole world has been badly affected by the spread of the virus forcing companies to shut down, heavy unemployment and huge downfall in the economy. Almost all major most economic activities have impacted by the disease. The markets have been heavily damaged by the Covid 19 and the effects are visible on the global economic growth. The global gross domestic product (GDP) growth projection for 2020 has halved by the Organization for Economic Co-operation and Development (OECD).

Current Situation in Indian Markets

Although, the market has slightly started to rise slowly such sudden fall in stock valuations and other instabilities have triggered panic across the world and shaken the confidence of investors. The past Friday turned out to be in favour of the investors. In the end, Sensex stood at closed 20% below the peak achieved two months ago whilst other markets which have fallen more.

When the equity and debt instruments were already hit badly, the crude oil war between Saudi Arabia and Russia has only worsened the economic conditions injecting volatility into other assets. Now, the economic tension has extended to currency and commodities market.

Suggested Measures for Ensuring Financial Safety of Investments

Investment professional prefers investment in high performing- financially strong stocks with relatively higher earnings & profitability, solid balance sheets, bigger cash flows, and more effective management should be preferred. At the same time, professional advisers also suggest equity investors alter their portfolio allocation towards large-cap and multi-cap stocks as the market correction might be a little prevalent in the short term.

It might be suggested this is a good time for long term investors to buy high valuation stocks at low levels. For making a profitable investment and subsequent appreciation in the investments value few conditions shall be seen such as high-profit margin stock, low debt and innate capability & financial soundness to sustain even if the share prices touch the rock bottom due to instabilities.

The more-safe investment options might also be suggestible like Corporate Bond funds / Banking & PSU Debt Fund which provide more reliability and trustworthiness in future which seems highly dynamic due to the highly volatile markets.

July 2, 2020

What is Stock Exchange?

Stock exchanges are markets where the participants come together for buying and selling of financial instruments such as shares, debentures, bonds, etc. it is run by set rules and regulations set by appropriate bodies such as SEBI in India. Only the securities of listed companies are traded with stock exchanges. All such stock exchanges shall be recognized by the government and only registered brokers and members are allowed to trade instruments on it.

There are around 9 official Stock Exchanges in India-

Bombay Stock Exchange (BSE)
National Stock Exchange of India (NSE)
Calcutta Stock Exchange
India International Exchange (India INX)
Indian Commodity Exchange (ICEX)
Metropolitan Stock Exchange of India Ltd. (MSE)
Multi Commodity Exchange of India Ltd. (MCX)
National Commodity & Derivatives Exchange Ltd. (NCDEX)
NSE IFSC Ltd. (NSE International Exchange)

April 1, 2020

3 Reasons Why We Should Invest in Falling Markets?

Recently the Indian Stock markets were seen crashing into a bearish phase where the stock prices fell more than 20% from the recent highs. Bear markets occur during economic recessions or depressions when pessimism prevails. In such markets, the prices of the securities drop heavily, and a negative sentiment causes a selling pressure upon the current which force the prices to stoop down even further.

As a general human behavior, most of the investors opt out of the securities they were holding and are ready to sell their investments at a lower price. This situation is often seen with a skeptical point of view. There is, generally, a lot of pressure upon the investors as well as on their financial advisors. One wrong decision or miscalculation could lead to a major financial loss. In common parlance, this situation is very stressful and involves a lot of decision making. But, despite all such risks in investments such scenarios can actually prove to be a good chance to reap some good alphas and it might not be incorrect to say that no matter how much villainous this phase looks like, it might offer you a good opportunity to earn.

Good Stocks at Affordable Rates

Legendary investor Warren Buffet had once stated, “Whether we’re talking about socks or stocks, I like buying quality merchandise, when it is marked down.” This is what happens in a bearish market. The prices of all shares both good and bad tend to fall down, opening a window to invest in lower than normal rates. As more people invest in such securities, the prices tend to recover and the growth is set back to the track.

Better Investment Options Highlight Up

As we have seen, the bearish markets are always preceded by tough economic conditions. In difficult environment, the corporates may struggle in paying their debts and other liabilities highlighting their creditworthiness. The creditworthiness is often rated by various independent credit rating authorities. When such reports declare a good report it means the organization is financially sound and is a good to shot to take.

In short, we can summarize that bearish phase is comparatively shorter than its counterpart, i.e. Bull. Therefore, the impact of bearish market upon the securities doesn’t sustain for a long time. The good stocks of companies having great creditworthiness shine in the bullish market following the bearish phase. So, the advice to invest in falling markets is highly justified subject to risk & careful

September 26, 2019

Why are the Corporate Giants Opting Out of the New Tax Cut-Off Scheme of Modi 2.0?

Story till Now

To stir up the economy, the Union Finance Minister, Nirmala Sitharaman has announced heavy tax cut off wherein the effective tax rate of around 35% has been reduced to mere 25%. On top of that, the tax rate for new domestic firms and new manufacturing units that set up in India, starting in October and commence production before the end of March, 2023 will be taxed at an effective rate of just 17%.

This announcement of the Central Government has been received with great enthusiasm by the market as the Sensex hiked up by 1900 on Friday and 1300 points on Monday. This decision, although would cause a revenue loss of around Rs. 1.5 lakh crore to the Union government, is being considered a much needed support by the government to support the falling economy.

Will the benefits of tax reduction be transferred to Consumer?

This move has been praised by all the business related community and has attracted investors. The tax-reduction, normally, results in lower costs and thereby higher demand for goods or services and ultimately resulting in the treatment of ailing demand. However, for now, it is rational to assume that the Businesses will not be transferring the benefits to the customers. The benefits from such tax reductions might be used to recover the losses that the organizations have faced because of the stagnant demand.

Recently, nearly every sector was affected by the poor demands and caused huge losses to the Indian market, resulting in loss of jobs and huge unemployment. So, we assume that the benefits would be definitely but not immediately transferred to the ultimate consumers, i.e. once the companies are have made good all the losses incurred by them in the past few months.

How is the corporate industry reacting for the same?

As stated above, this has provided benefits to the organizations by reduced tax slab and even higher market evaluation for most of the Companies. Although, now the corporate have the option of opting lower tax regime but the condition of foregoing other exemptions has made an economic dilemma in the minds of corporate. Therefore, we are seeing two kinds of actions by the corporate.

Some corporate are opting in the new tax rates and availing the benefits that new policies provide. However, on the other, few corporate such as Godrej and Dabur are opting out of the new scheme.

Why are some corporates opting out of the new scheme?

These actions by the giants follow their decisions to claim exemptions provided in the various sections of Income Tax Act, 1961 which would lapse if these corporate giants opt for the new scheme. As far as we can say, the companies who have a lot of exemptions to claim might skip the new schemes as of now and once these exemption benefits have been satisfied, they would opt in the new schemes.

We would like to conclude that companies which are willing to reap the benefits from various exemption-related provisions of the Income Tax Act tax cut off are opting out of the new schemes, rest are highly satisfied by the ‘new gift’ of the Finance Minister.

September 24, 2019

Why the Indian Market Rose up By 1900 Points?

On Friday, the Indian government launched an all out attack on the drooping Indian economy to counter the economic slowdown. Surprisingly, it was welcomed by the investors at a great level where the Sensex rose by over 1900 points and Nifty closed at 11,254.

The main attraction of the announcement made by the Finance Minister was the tremendous decrease in the tax slab of corporate tax rate. In order to boost up the businesses, there was a significant cut in the corporate tax rates, the effective tax rate (inclusive of surcharges) for domestic corporate, have been reduced from 34.94% to 25.17%.

Also, the tax rate for new domestic firms and new manufacturing units that set up in India, starting in October and commence production before the end of March, 2023 will be taxed at an effective rate of just 17%.

The above decision of the government is being called as the most visible factor leading to the drastic change in the market, where Sensex and Nifty observed their biggest one-day rise since 2009.

What does this offer to the economy?

The decision clearly offers an incentive to the Indian markets to invest more in the corporate. As, most of advisors are suggesting, the present tax cut has made the country more competitive on a global level as far as corporate taxes were ever concerned.

It must be noted that whenever such cuts are made there is obviously a loss of revenue for the state. However, such a loss is generally recovered if such an incentive is actually able to stir up the market. There are many benefits, this might bring such as more investment, employment, etc.

Would it be actually helpful?

Whether or not this change of corporate actually stimulates the current economic slowdown, would be seen in time, but we would like to state what the experts are advise. On one hand, people are saying that this reduction is just a concession rather an actual help. As the real problem is the reduction in demand. Others say that the structural reforms such as GST has caused a loss in the demand of goods and employment. So, it is possible that such a reduction might actually help the current situation.