Buy GARP – Growth at a reasonable price.
“Almost all Old Money secrets can be traced to a single source: a longer-term outlook.” – Bill Bonner.
The political leadership issue is slowly taking a decisive trend. Market leadership always evolves in anticipation of political trends. In that sense, the stock market has been way smarter in making its leadership choices. Politically connected businesses have actually not managed to fire up the imagination of investors. The results of Reliance only reinforce the belief that politics can only help a business that much. The public conscious in 2014 seems far more evolved than it was a decade ago. That really is the story of this election. The markets are at a new high. Reliance is nowhere near an all time high. It needs a miracle to get there. If the Modi factor is what will give a stock price a fillip, it only indicates how far things have dipped. In any case, that would be a short lived rise. Meanwhile, the leadership in the stock market has moved on clearly to a bunch of new companies. We no more have a unitary leadership structure. The good news is this bunch of market leaders is only getting bigger and stronger. That really is why the story of the Indian market will remain strong and formidable.
Investment Strategy: Keep a close watch on value.