Looming concerns over economic growth amid worsening of the coronavirus spread caused India’s benchmark equity indices — Sensex and Nifty – to plunge nearly 7 per cent in last six sessions before showing early signs of rebound on Friday.

Some 49 stocks in the Nifty pack shed weight in this selloff. But, analysts see the fall as an opportunity to lap up quality stocks.

“This is a buy-on-dip market,” says Nilesh Shah, MD and CEO, Envision Capital. “One needs to keep accumulating a chosen set of stocks and keep constructing a portfolio from a two- to three-year kind of outlook,” he told ETNOW.

The 50-share Nifty plunged 799 points to 10,805 level on September 24 from 11,604 on September 16. Private sector lender IndusInd Bank tanked the most at 21 per cent to Rs 490.20. It was followed by Tata Motors (down 19 per cent), Bharti Infratel (down 16 per cent), Tata Steel (down 15 per cent).

“This kind of fall always offers opportunity to lap up quality stocks with a long-term perspective. We are positive on Britannia, Asian Paints, Kotak Mahindra Bank and UltraTech Cement in the Nifty pack. Overall, the market is going to be volatile this year in the run-up to the US election,” said Sanjeev Hota, Head of Research, Sharekhan.

Stocks like Bajaj Finance, Hindalco, Bharti Airtel, Indian Oil Corporation, Zee Entertainment, Bajaj Finserv, Adani Ports, State Bank of India, Maruti Suzuki, ICICI Bank and Britannia cracked up to 14 per cent in this fall.

“The IT and pharmaceutical spaces look resilient in comparison with others. I will prefer Sun Pharma, TCS, Infosys, Reliance Industries and Asian Paints after this fall. Banking and financials must be avoided as of now,” said Ajit Mishra, VP-Research, Religare Broking.

In the latest projection for the banking sector, S&P Global Ratings on Thursday said Covid-19 disruption and oil price shock of 2020 are taking a heavy toll on global banks. “Therefore, it will be difficult for them to return to pre-crisis levels in next three years,” it said.

Sectorwise, BSE Telecom index retreated 14 per cent to 1,018 on Thursday from 1,181 on September 16. Global brokerages Macquarie and Credit Suisse are positive on Bharti Airtel with a price target of Rs 700, an upside of 67 per cent from the current market price of Rs 418. On Friday, the stock traded at Rs 432, up 3 per cent.

The sector came under pressure after billionaire Mukesh Ambani’s Reliance Jio on Tuesday unveiled new postpaid plans that offer up to 500GB data and subscription to Netflix, Amazon Prime and Disney + Hotstar.

The BSE Metal, Realty, Banking, Auto, Oil & Gas, Power, Capital Goods, Consumer Durables, FMCG, TECk, IT and Healthcare indices declined between 3 per cent and 12 per cent in this selloff.

Vinod Nair, Head of Research, Geojit Financial Services said, “Defensive sectors with a positive outlook like pharma, FMCG, IT, chemicals and telecom will tolerate the market’s negative trend and bounce back strongly in case of any rebound in the near term.”

Dr Reddy’s Laboratories (up 8 per cent) was the lone gainer in the index. The stock hogged the limelight after the company last week said it had settled the litigation with a unit of Bristol Myers Squibb related to patents for Revlimid (lenalidomide) capsules used in the treatment of cancer. Brokerage Nirmal Bang Securities has a ‘buy’ rating on the drug major with a price target of Rs 5,656.

Mayuresh Joshi, Head of Research at William O’Neil, advised caution. “One should wait for few more days before buying into the beaten-down stocks. This is the time to create a list of high conviction stocks,” he said.