Investment Faqs with Parimal Ade (Investment Satsang- 19)

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Here are some questions asked by the viewers in the Investment Satsang dated 03rd  September 2021. These questions can provide you insights on some grounds. Please read these questions for knowledge purposes only and make any investment decisions only based on your research or the advice of your financial advisor.

Q Is the ratio of 45:35:20 for Large-Cap, MidCap, and Small-cap portfolios a good outlook for the Long Term??
Parimal Ade:

• It depends on the risk profile.
• It depends on the investment horizon for which financial goal you are investing.
• There is no exact thumb rule for this and it varies from person to person.

Q View On M&M?
Parimal Ade:

• Lot of right steps M&M is taking as Tata Motors.
• It depends on how XUV 700 gets the response and how the company performs in the EVs segment.
• The auto sector needs to analyze properly ultimately who is responding well towards the electric vehicle ecosystem.

Q Considering Tata Motor’s overdependence on JLR performance is it a stock to hold as in the electric vehicle sector?
Parimal Ade:

• As the vision has been kept by the Tata Group to become debt-free. They want to have free cash flows all those things we need to understand.
• As they have got permission from NCLT to hive off the passenger vehicle.
• It is also understood that dependency on JLR is also high. But the markets are improving and normalcy is also coming.
• There is a shortage of semiconductors so there is the possibility of seeing the bad phase in the next 2 quarters.
• The market has already discounted a lot of things.

Q View on Government Securities?
Parimal Ade:

• The institutional investor money parks majorly in 2 asset classes i.e., Equity and Debt.
• The Debt is majorly government securities they need to park this money in risk-free assets.
• The US GSec yield was 1.25 to 1.35. The risk-free securities are trading with a 70+ PE ratio at the starting of the month (September).
• Once the G-Sec yield starts going up. A serious correction will come when the interest rates are increased or When there is an alternative created for the equity then the market can correct it.
• Need to follow the see-saw battle.
• The Interest rate is increased by the Central Bank when the inflation rate is high in the economy to curb the same.

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