Expert view: Anuj Jain of Green Portfolio PMS on why Trump tariffs not a big risk, key positives for markets and more

Mint

3 days ago

Expert view on markets: Anuj Jain, co-founder of Green Portfolio PMS, believes US President Donald Trump's tariff measures will have only a limited impact on the Indian economy and equity markets. According to him, multiple domestic and global factors are likely to support market sentiment and help the Nifty 50 end 2025 with healthy gains.
In an exclusive interview with Mint, Jain shared his outlook on the Indian stock market, the impact of Trump's tariffs, and the sectors he is betting on. Edited excerpts:
Indian equities have been one of the most reliable wealth creators over the past many years, but the ride has never been smooth.
Investors often enjoy stretches of strong, multi-year gains, only to face sharp corrections that test patience.
What matters in the long run is not short-term swings, but the core drivers: steady earnings growth, compounding, and the discipline to stay invested.
History suggests that investors who stayed invested for roughly a decade have almost always ended up with healthy outcomes.
Shorter holding periods, on the other hand, can feel uncomfortable, with drawdowns that often look worse in the moment than they appear in hindsight.
At present, valuations sit somewhere around long-term averages—not too expensive, not a bargain either.
That means earnings must do the heavy lifting for future returns, particularly as corporate profits normalise and recover over the next couple of years.
The message for investors is straightforward: stay patient, focus on resilient, high-quality businesses with strong cash flows, and manage risk through sensible diversification.
Geopolitical events, like war or protectionism, are a new normal. Make a habit of seeing them and ignoring them. If you can't live with it, do FD.
The situation is very fluid. Right now, valuations don't look stretched. They are sitting roughly in line with long-term averages—early twenties on a price-to-earnings basis. That's neither cheap nor bubble territory, so returns from here hinge more on earnings delivery than on multiple expansion.
A direct answer to this question is very difficult. Some data points and arguments make me believe that we will still make good money in 2025. These are –
(i) While FII have been the biggest seller in calendar year 2025 (CY2025) so far, Indian investors (mutual funds, insurance companies), also known as DII, kept buying in this period. Total money infused by mutual funds alone in the markets is ₹ 3 lakh crore in the calendar year 2025 till May 2025.
(ii) We're still the fastest-growing economy, faster than China (6.5 per cent versus 4 per cent).
(iii) India exports around $80 billion of tangible goods to the US yearly. Out of this, 30-35 billion is exempt—mostly pharma and mobiles. So, about $45 billion worth of exports will be hit. As against, we are an economy of $4,300 billion a year. So, 1 per cent of it is not going to create a recession in India.
(iv) The Indian government is striving to enter into FTAs with various countries. An FTA with the EU is supposedly very close to being completed.
(v) The biggest of all is the rising domestic consumption in India. With propensity to consume, we are such a big market that manufacturing for ourselves will give a great boost to our economy.
The backdrop today is tricky. Tariffs are not just a one-off trade spat — they are broad, higher, and likely to stick for longer.
A baseline duty is in place on nearly all US imports, with country-specific add-ons and sector-specific levies like metals and industrial inputs.
India's exposure is real. Export categories such as textiles, gems, leather, and low-end engineering are vulnerable.
On the other hand, pharma, speciality chemicals, and parts of tech are relatively shielded.
From our interaction with export-based companies' promoters, we understand that they compete in global markets on a 5-10 per cent price difference. So, basically, at a 25 per cent tariff, your export is gone.
So, it does not make a difference between a 25 per cent or a 50 per cent tariff. Raise it to 100 per cent, and it still will not make much difference.
Of course, US export-heavy companies like KPR Mills, Welspun India, and Bharat Forge Ltd. will be hit in the short term.
So, we have a little more focus on domestic demand now. We have not changed our strategy much in this situation. These are the reasons –
(i) India is the biggest democracy, and the US is the most powerful democracy, so they cannot fight for very long. The tariff issues will be settled soon.
(ii) We believe in identifying companies/promoters with mettle. Once that is done, enter at a good valuation and then 'wait'. This is our way of working; this is how we have made money. Remember what Charlie Munger said: "The big money is not in the buying or selling, but in the waiting."
(iii) Even if the tariff stays for a long time, these companies are smart; they will evolve. They will learn to send the almost finished goods for 'final little processing' somewhere, then export from there. If there is a demand and you have the supply, it will find its way. It's like seepage and water.
(iv) New geographies are being opened for Indian manufacturers as the government aggressively works on various FTAs. Four major FTAs have already been signed in the last three years. An FTA with the EU is expected this year. This will be a big development. The EU is a quality-sensitive market, and these companies, which are hit by US tariffs, have export-ready products. So just wait and watch.
(v) The Indian government will also take measures to help these companies.
Make in India is a massive trend. It's like the IT phase of the early 2000s. The opportunity it poses runs into billions and trillions of dollars.
Companies worldwide want alternatives. India is becoming that alternative. The government's PLI (production-linked incentive) schemes have already brought in ₹ 1.76 lakh crore in investments.
Companies making mobile phones, car parts, medicines, and electronics for both the Indian and global markets are seeing unprecedented demand. Take this data: From nothing just five years back, we exported Apple mobiles worth $18 billion in FY25.
In manufacturing, there can be many pockets where one should keep an eye. Defence is definitely something to look out for.
Another sector is export-based manufacturing. Companies that have that quality of product and existing relations in the export market will definitely tap the 'anti-China' opportunity.
The US Tariff will have some short-term impact, but it will be covered by various other FTAs already done and/or very close to being signed.
Another trend to watch out for is Domestic Consumption and higher income, coupled with a higher propensity to consume.
SIP is a wonderful tool; it cuts out the noise and keeps us consistent. By putting in a fixed amount every month, investors automatically buy more when markets fall and less when they rise, removing the stress of 'when should I invest?'
Money goes in regularly, whether the news is cheerful or gloomy. Over time, this habit not only smooths out the ups and downs (through rupee-cost averaging) but also lets compounding quietly build wealth in the background.
The real edge of SIPs is not timing but time. Staying invested across cycles has historically rewarded patient investors, while those waiting for the 'perfect' entry often missed out.
SIPs work because they build wealth quietly—through discipline, averaging, and compounding—while the world chases headlines.
It is also more logical. Most people earn regularly, e.g., a monthly salary, so it makes sense to invest regularly.
As mentioned earlier, Make in India is a year-long story unfolding before us. To support that, we need investment in infrastructure. Third is domestic consumption and a rise in income. I think all three of these will cover most of the sectors.
So, in a nutshell, your life is set until you are invested in India. Regarding avoiding export-based companies, I will not subscribe to this idea. Maybe reduce the concentration on those companies, but stay invested in them.
The reason is simple: we believe in identifying companies/promoters with mettle. Once that is done, enter at a good valuation and then 'wait'. This is our way of working, and this is how we have made money.
These export-based companies have quality products, and their promoters have a global vision. If they can't export to the US, there is and there will be a big and growing market in India itself.
The Indian consumer is growing more and more quality-conscious. They are no more, only 'cost' now. The trend will continue.
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Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.