PSU Stocks: Rally, Correction, and the Road Ahead

I invested in PSU stocks during their 2023-24 rally. Although I saw modest gains at first, many of these stocks have since corrected sharply and continue to trade well below their highs. Could you share a detailed outlook on the PSU sector to help me decide my next steps? - Vivek Shrivastava [EasyDNNnews:PaidContentStart]

Editor Responds: Thank you for your question. The PSU rally in 2023-24 was fuelled by reform optimism, robust order books, and a favourable policy backdrop. But as prices soared, valuations ran ahead of fundamentals, making stocks vulnerable to corrections. Profit booking by institutional investors, global macro headwinds, and sector-specific earnings concerns have since triggered a notable decline from the highs. While the correction may appear sharp, it also offers a chance to reassess quality names with strong balance sheets and growth visibility.

For investors, it is important to focus on fundamentals rather than past rallies. We will present a detailed analysis of PSU opportunities and risks in our upcoming magazine issue.

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