It is difficult to find value in a market
which is trading at its all-time highs. However, given the lopsided growth, stocks
are trading at extreme valuations. There are many Nifty stocks
available two standard deviation (SD) above (or below) their financial metrics like price-to-earnings
(P/B) and enterprise value (EV)-to-Ebitda.
Recent winners such as Tata Consultancy Services (TCS) and Hindustan Unilever
(HUL) are trading at a P/E two SD above, while state-owned ONGC
is available two SD below. Experts say, the market
is rewarding companies
with strong growth potential, while punishing those where there is a cloud of uncertainty. The consolidated, 2018-19 consensus earnings estimates for Nifty stocks
has increased by 0.2 per cent in the past one month, but the index has risen five per cent.
like TCS, Tata Steel
have seen some upward revision in their consensus 2018-19 earnings expectations. On the other hand, Bharti Airtel, Vedanta and HPCL have seen their earnings estimates being cut.