“NIFTY is trading at a trailing PE of 26 plus. Yes, it appears that it has become expensive, but as we adjust the Nifty performance for a handful of large weight stocks, the real picture is that large caps are not as expensive.
Particularly with earning cycle turning up, and the increasing possibility of political stability, equity might surprise everyone.
While I believe one need not be overweight equity, it’s the right time to start reducing the underweight. After all, not investing in equity could be riskier than investing, over a period.” said Mr Bhavdeep Bhatt, Head-Institutional Business & Portfolio Management Service, Aditya Birla SL Mutual Fund.