'Consumption and demand levels remain strong'

Even though the country’s manufacturing growth slowed in March, Ashu Madan, president (equity broking), Religare Securities Ltd, tells Puneet Wadhwa how it does not hamper India’s growth story. Edited Excerpts:

The equity markets have been lacklustre for quite some time now. What are the reasons for the same?
The Sensex has moved up from 10,000 to 17,000 in a short span, fuelled by global economic recovery and election results in the country that led to the formation of a stable government.

If you look at the current picture, it’s the frontline stocks, that is, Sensex and Nifty stocks that are exhibiting a lacklustre movement. Otherwise, there is enough sectoral movement on a rotational basis.

I think the markets are in a consolidation phase right now. And do not expect a runaway rally. One has to look beyond large-cap stocks for investing opportunities. The Nifty is poised for an upside and can touch 5,600 levels in the next three to four months.

What is the outlook for technology scrips given the strengthening rupee?
Technology stocks were in an uptrend even when the markets were trending down. This was possible because of good results in the third quarter of the current fiscal and the rupee-dollar equation.

Rupee strengthening will not impact them too much as most technology companies have their treasury departments in place. For the rupee, Rs 48-50/USD levels are ruled out as the global economy is in a much better position. I expect the Indian unit to range between Rs 43-44/USD in the medium term.

India’s manufacturing growth has slowed in March. Does that hamper India’s growth story?
The dip in manufacturing growth is a short-term phenomenon and does not derail the India growth story. Consumption and demand levels remain strong, which will give enough impetus for the buoyancy in Indian economic growth.