The array of companies that investors can invest in has gotten much wider and it will grow even further with a lot more new age companies hitting the bourses. Should one approach the market with a lot more caution than in the past?
The most important thing is to be doubly sure while investing. Number two, a few of the new age businesses with niche technology and a niche market share have done quite well and we have seen the two blockbuster listings — Zomato and Nykaa. While Paytm was expected to be a blockbuster listing, it did not happen that way. The valuations were stretched.
My sense is going forward, when one enters such new age businesses, one needs to be very careful, understand the business dynamics, understand the valuations and the future plans for the company and how they are going to grow it. So this is going to be more important for it. It is not only just a new age business.
A story that took the back seat at the end of the week on account of Paytm is Vedanta. That counter got beaten pretty badly in trade on account of the restructuring suggestions that came out. We are still waiting for absolute clarity on what is anticipated. How do you react to something like this?
They are talking about restructuring and listing of the individual entities — the steel, aluminium companies that they are going to list separately. There are question marks about how they are going to do it and how the shareholders will get the value.
I think they are confused. As to why it has come in at this juncture is also something the shareholders are talking about. I think that is the main reason we saw the thumbs down to Vedanta stock.
However, there was a thumbs down in most of the metal sector on Thursday as well. Most of the steel stocks were down 3-4%. We will need to get more clarity in terms of the entire Vedanta restructuring.
