Russia’s attack on Ukraine has caused a huge fall in the stock markets around the world. Many investors are seeing this fall as a great buying opportunity in the stock market. However, Nikhil Kamat, co-founder of Zerodha and True Beacon, does not see the recent fall in the market as a good buying opportunity and believes that the stock market has not yet fallen enough that the lower Buy level.
Nikhil Kamat in an interview to Livemint said, “The stock market has not fallen that much yet. The market has risen almost 100 per cent and after that it has declined by 12-13 per cent. In terms of volatility, when Even if you see a fall of 10-12 per cent, it means that there will be some more fall in it. So, I would not say that this is the right time to buy now.”
He said, “Amidst the geopolitical tensions, new news is coming every hour, which is affecting the market. So I think people should wait and see where this geopolitical tension leads. And what is the impact of inflation with that. I don’t think it’s time to buy at lower levels.”
Also read- Russia-Ukraine War: Indian investors’ money dipped more than Ukraine’s GDP in just 3 weeks
Nikhil Kamat said that if you compare today’s multiples with any time before, even a comparison at 16,300 shows that the market is expensive. In such a situation, it is very difficult to estimate the risk to reward ratio. I would say the risk to reward ratio is in your favor when the market is around 15 PE or 16 PE or something like that which is not there yet. So, I would say the markets are still expensive.”
Kamat further said, “I do not think that the issue between Russia and Ukraine is going to end soon. It is not expected at least for the next two months. So I think the volatility in the market will continue. “
Regarding the price of crude, Nikhil Kamat said, “In the budget in February, we estimated the price of crude oil to be $ 70-75 per barrel. It is at 110 today, and it looks like it will go up to 130-140. If this happens, then the pressure on our fiscal deficit will increase significantly. Perhaps, then there may be a slight depreciation in the value of the rupee. So, if we see a slightly negative market for the next six to 12 months, So I wouldn’t be surprised.”
,