*The forward PE of Sensex has now taken an upturn in April, standing at around 13x the FY10 earnings. Religare Equity Research expects Sensex P/E to go to highs of 14x – 15x and Sensex could move to maximum 13000 levels in current rally.
*Equity markets have moved up in no time with over 30% returns. Investor may allocate around 40% of total corpus to equity, book profits on rest of the portfolio and wait for correction of around 10-12% or up to Sensex 10500 to make another 30% investment in markets.
*IMF says that the Indian economy is projected to grow 4.5% in 2009, down from 5.1% projected earlier with the growth rate expected to rise to 5.6% in 2010. The global economy on the other hand is set to projected to contract 1.3% in 2009.
*The expected continuation of the slump is on account of the probable write-offs of the toxic bank debt in the US, Europe and Japan which could reach $4.1 trillion.
*While the recent run-up rally in the Indian markets may have raised the valuations from rock bottom levels seen at the beginning of the year, we can still find tremendous buying opportunities in the Indian market due to its growth potential.
*The RBI expects the Indian economy to grow at 5.7% in FY10. This number is still higher as compared to most global and Asian economies.
*Investor may build a long term oriented portfolio of large cap fund investments and buy in staggered manner during big market corrections.
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