Could we see a retest of 7200 or even worse than that? I think there is a strong support at about 7200 or thereabouts from where the market rebounded many times. But with the sort of budget being in the offing, people have started discussing that over the next couple of weeks and that might offer some support.

Are you of the view that the market mood and the market behavior is reminiscent of 2008? No, I to do not think it is as bad as that. There is still hope because all said and done, it is domestically the action of the government in terms of trying to revive the economy by investing through the publicity units that might actually start giving some hope over the next quarter or two. This will hopefully keep the market from falling dramatically like in 2008. If something dramatic happens in China, then all bets are off but as long as that is under control and as long as the government efforts at reviving the confidence in the economy and reviving the growth momentum starts bearing fruit over the next quarter or two, things should bottom out at around 7250 or at worst, 7100 levels. PSU banking sector : The efforts of the government in trying to revive the economy has to show some results in terms of the revival of the NPAs and only then you can really see the PSU banks being able to finance the growth momentum. This is probably going to be realized over the next couple of quarters. Therefore, you cannot really write them off. The government has to ensure that they are revived and are in a position to finance the growth momentum in the country.

On Pharma: We were only hearing about the clampdown earlier but now we are also hearing some good news that some of the pharma companies have passed the test. There will be more issues with the FDA and some of them will come out with flying colours and therefore I think this is one sector which probably has had quite a torrent time for the last few months at least because of the FDA and if they pass this test in flying colours, there will be a 2-3 year horizon of quite some value, resting there.

A time to shop and pick up some bargains : If you are a medium-term investor with at least a couple of years' horizon in mind, then I think the leading blue chips are the ones that give you the opportunity now because whether it is engineering, pharma or private sector banks. These opportunities you get probably once or twice a year and you should grab these. There is a possibility that it may go down another 4 or 5 per cent but that is par course and we are looking at 20-30 per cent return over the next year-and-a-half.

On Capital Goods / Infra: look at companies which probably still have reasonable order positions and execution capabilities and are available at bargain prices just because probably the result was not good or probably because there were some issues during the last quarter or two. I think if the economy has to revive, if construction and infrastructure has to revive, there are probably couple of dozen companies which can actually execute these projects. I think these are the levels at which, provided they have orders flowing and have execution capabilities, one should have a two-year view and start accumulating these stocks.

On mid-caps vs. large caps: When you are able to get blue chip stocks at basement prices, there is no reason why the mid-cap stocks have to quote at such valuations and especially when the pain is going to be felt more with mid-caps. I think that correction has taken place to some extent but more of it is certainly in the offing, especially for those who have not delivered on the promise that was there in terms of the valuation. I think people expected these companies will come out with numbers which are dramatically different from the large cap ones but since that was not the case; the correction is going to take place there. Investors who are bottom fishing would probably go in for large cap stocks now rather than be invested in the midcap stocks which have outlived their valuation levels.