Surgical strikes: Take advantage of market to buy prize largecaps: Parag Thakkar, HDFC Securities

In a chat with ET Now, Parag Thakkar, Head-Institutional Sales, HDFC Securities, says for an institutional investor this kind of opportunities are actually very good opportunities. Edited excerpts


ET Now: Let us talk from a perspective of somebody who does not necessarily have a skin in the market. Would it be prudent for somebody to take a step back and let the situation stabilise and then think of investing, what is the hurry?

Parag Thakkar: First of all I would like to say that every day we talk about markets. I think this is the time we should salute our soldiers because of whom we are here and our government also which has taken such a bold step. So I would like to sincerely appreciate this thing. And about stocks, I would agree to you for a person who is not a compulsive investor or not a fund who has to be in markets, it makes sense to sidestep and just wait for things to settle down. But for an institutional investor this kind of opportunities are actually very good opportunities.

ET Now: Why cannot this opportunity become better?

Parag Thakkar: It can get better but who knows, right? You know generally what happens is that when things become clear you do not get opportunities and you know that since long we have been waiting some of the good stocks to correct, maybe this and in the coming 10 days we will get those opportunities. So I am not saying just go out and buy today itself but definitely you should be ready with your stocks and this time definitely largecaps will correct more because they are held by foreign investors.

I would be a buyer on dips, gradual buyer on dips definitely in select largecap names.

ET Now: What would be your word of advice to investors out there watching this fall?

Parag Thakkar: It will be a clear avoid of any leveraged positions and whatever cash you want to put as equity portfolio, this is a good time. These uncertain times are best to invest and try to invest in largecaps, high quality largecaps. I would start with something like Kotak Mahindra Bank or Maruti or Asian Paints or Grasim. These are the stocks or Tata Motors for that matter. These are the stocks one should buy in this kind of uncertain times. It will quickly bounce back and there is no need to sell also because all of them are generally compounding stories.

ET Now: And avoid smallcaps and mid-caps? Avoid that space for now it is really the largecaps where the opportunity is coming back?

Parag Thakkar: Largecaps will also fall. When largecaps fall, you should buy largecaps first and that too this kind of high quality largecaps.

ET Now: And it is also about the margin of safety with large caps in an environment which is uncertain?

Parag Thakkar: Absolutely and you should be in liquid stocks. Of course we like so many mid-cap stocks as we discussed earlier like Carborundum Universal, Vinati Organics so those are there but when large caps are falling 3-4-5% and that too if it extends I think it makes a lot more sense to buy.