Are asset managers a safer bet than brokers in India's capital market?
asset managers
rather than exchanges and brokers, said money managers. While exchanges and brokerages are likely to feel the heat of the various regulatory actions aimed at curbing excess speculation in futures and options,
mutual funds
and allied businesses may continue to benefit from flows into their products, making them a safer bet at this juncture.
"While the downgrade cycle in capital market stocks has bottomed out, there could be degrowth in broking stocks given the slowdown, but AMCs could perform better," said Mahesh Patil, CIO,
Aditya Birla Sun Life AMC
. The
Nifty Capital Market index
has been the best performer among all NSE indices in the last three months. After slumping 20% from its peak in October, it has rebounded in the past three months. Since mid-April, the index has surged 31.4%, while the benchmark Nifty gained 7.6% in the same period.
Explore courses from Top Institutes in
Select a Course Category
Data Science
Healthcare
Product Management
Project Management
MBA
CXO
Degree
Technology
Operations Management
Public Policy
Data Science
Leadership
Digital Marketing
Artificial Intelligence
others
Management
Design Thinking
MCA
Others
Data Analytics
Finance
PGDM
Cybersecurity
healthcare
Skills you'll gain:
Duration:
11 Months
IIT Madras
CERT-IITM Advanced Cert Prog in AI and ML India
Starts on
undefined
Get Details
Skills you'll gain:
Duration:
30 Weeks
IIM Kozhikode
SEPO - IIMK-AI for Senior Executives India
Starts on
undefined
Get Details
Skills you'll gain:
Duration:
11 Months
E&ICT Academy, Indian Institute of Technology Guwahati
CERT-IITG Postgraduate Cert in AI and ML India
Starts on
undefined
Get Details
Skills you'll gain:
Duration:
10 Months
E&ICT Academy, Indian Institute of Technology Guwahati
CERT-IITG Prof Cert in DS & BA with GenAI India
Starts on
undefined
Get Details
Skills you'll gain:
Duration:
10 Months
IIM Kozhikode
CERT-IIMK DABS India
Starts on
undefined
Get Details
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
목어깨 아플땐 "이모양 베개" 절대 쓰지마세요.
7년차 개발자
더 알아보기
Undo
Agencies
Nippon Life India AMC jumped nearly 50% in this period.
CDSL
and
Anand Rathi Wealth
gained 40% and 45% respectively. While the index remains 6% below the peak, money managers said valuations of most of these entities, especially brokers, may be rich, making them vulnerable to a sell-off.
"The current valuations appear expensive for broking companies, given their cyclical nature and high correlation with market movements, and we remain cautious on them," said Vikas Gupta, CEO, OmniScience Capital. "What we have done, and suggest for investors, is to take selective exposure to banking stocks that own AMC subsidiaries, as they offer more attractive valuations and meaningful upside potential from current levels."
The rich valuations are encouraging companies to sell shares in the primary market, with NSDL and ICICI Prudential AMC looking to launch their initial public offerings over the next few months.
Live Events
'When large IPOs from a sector are expected to list in the market, buying interest emerges for other listed players as well, but investors should keep tabs on the valuations as well,' said Chirag Mehta, chief investment officer, Quantum AMC.
Profitability of exchanges has taken a hit of late after the Securities and Exchange Board of India's actions to temper retail investor activity impacted activity. In the case of broking firms, the regulator's steps to tighten regulations also squeezed their profits.
'When the markets corrected last year, capital market stocks witnessed a sharp fall from the peak due to reduced activity, followed by a regulatory clampdown on F&O volumes and margin requirements,' said Mahesh Patil, CIO, Aditya Birla Sun Life AMC.
The bearish sentiment has stablised since, and capital market stocks have been inching higher in line with broad market performance, said Patil. Analysts said technical indicators are not showing a reversal yet despite the rebound.
'We may see some consolidation in these names, as they have massively run up in the last three months,' said Ruchit Jain, vice-president, head, technical research,
Motilal Oswal Financial Services
. Traders and investors can use a 'buy on dips' approach in the near term, especially for CDSL and MCX, which could run up as these stocks have seen strong trading volumes despite some decline, said Jain.
'While capital market stocks offer higher relative growth, valuations are elevated after recent run-up and private banks and insurance stocks are a better bet as they offer comfort in valuations and decent growth prospects,' Mehta said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
17 minutes ago
- Time of India
State lags in renewable energy generation despite huge potential
Ranchi: Jharkhand has made modest progress in renewable energy sector despite possessing ample resources, stated the 'Powering Progress: Jharkhand's renewable energy and storage potential' report released on the occasion of Renewable Energy Day on Wednesday. The study by the Jharkhand Sustainable Just Transition Task Force and the Centre for Environment and Energy Development (CEED) assessed renewable energy potential across 24 districts of the state. "Renewable sources contribute just seven per cent to the state's energy production. While Jharkhand has an estimated renewable energy and storage potential of 66 gigawatt (GW), its installed capacity stands at only 434 megawatts (MW) as of 2024-25 FY. The gap between the potential and the actual energy generation was due to the lack of detailed and actionable research at the block and district levels," the report stated. Out of the 66 GW energy potential, the state has an estimated potential of 46 GW from various renewable energy technologies and 20 GW from pumped hydro energy storage. Giridih, Ranchi, Gumla, West Singhbhum, Hazaribag, Palamu, and Chatra districts were identified as high-potential areas for generation of renewable energy and integrated renewable energy planning with district-specific targets for renewable energy were recommended. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like American Investor Warren Buffett Recommends: 5 Books For Turning Your Life Around Blinkist: Warren Buffett's Reading List Undo Task force chairperson AK Rastogi said, "The report presents the first of its kind comprehensive, high-resolution assessment of renewable energy potential across all 24 districts of Jharkhand, which can provide a transformative opportunity redefining the state's economic and environmental future. This assessment will fill the gap and demonstrate that the transition from coal-dependent energy systems to renewable sources is not just environmentally imperative but economically compelling, offering pathways to create green jobs while attracting investments in the state. " Applauding the state govt's initiative, CEED CEO Ramapati Kumar said, "The state can ensure energy security, economic diversification, and climate resilience while setting a benchmark for eastern India's clean energy future by embracing its renewable potential. CEED is proud to provide steadfast support to the task force and the state govt in pursuit of low-carbon development pathways." Stay updated with the latest local news from your city on Times of India (TOI). Check upcoming bank holidays , public holidays , and current gold rates and silver prices in your area.
Time of India
18 minutes ago
- Time of India
Cabinet nod for policies to boost jobs for women, youth & ex-servicemen
Dehradun: The Uttarakhand cabinet, which met soon after the state assembly was adjourned sine die on Wednesday, approved a proposal to frame separate policies aimed at increasing employment opportunities for women, youth and ex-servicemen. The policies will focus on skill development and creating jobs in both govt and private sectors. Training programmes will be organised for competitive examinations, including govt services, NEET, nursing, foreign languages and artificial intelligence. Large-scale youth festivals and job fairs will also be held. ITIs, polytechnics, and schools will work together to promote vocational education, while short-term, medium-term, and long-term plans will be implemented to connect youth with employment. Chief minister Pushkar Singh Dhami said, "This initiative will go a long way in providing earning opportunities for people in the state." To promote self-employment among women and youth, training in beekeeping, apple cultivation and horticulture will be provided to 200 people in each block in the initial phase. A voluntary land consolidation scheme will also be launched shortly. An MoU has already been signed between the agriculture department and the Indo-Tibetan Border Police (ITBP) for the purchase of local products such as fruits, vegetables and milk. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like These Are The Most Beautiful Women In The World Undo Similar MoUs will be signed with the Sashastra Seema Bal (SSB) and other central agencies to expand the market for local produce and enhance livelihoods. The industry department will facilitate market linkages in the private sector, while ex-servicemen working through UPNL will be integrated with govt schemes for employment and self-employment and matched with services suited to their qualifications across institutions. The cabinet also approved the Uttarakhand Crime Victim Assistance (Amendment) Scheme, 2025. Home secretary Shailesh Bagauli said that the existing Uttarakhand Crime Victim Assistance Scheme, 2013, amended in 2014 and 2016, was notified under section 357(A) of the Criminal Procedure Code, 1973. While Pocso courts have issued orders for compensation to victims under the Pocso Act, 2012, the scheme so far lacked clear provisions, leading to practical difficulties. To address these gaps and ensure compliance with court directions, the scheme has been amended and the new provisions are being notified. A Schedule-2 has been added specifying minimum and maximum compensation amounts for Pocso victims, which will enable timely and effective assistance. To strengthen the justice system, the cabinet further approved the Uttarakhand Witness Protection Scheme, 2025. The scheme is designed to ensure the safety and dignity of witnesses so they can testify freely and truthfully in court without fear, pressure, or retaliation. It includes measures such as confidentiality of identity, relocation, changes in contact details, physical security arrangements and financial assistance when required. Confidentiality has been accorded the highest priority in all decisions. A state witness protection committee, comprising members of the judiciary, police, and senior district officials, has been constituted to assess witness security needs and implement appropriate protection measures promptly. Stay updated with the latest local news from your city on Times of India (TOI). Check upcoming bank holidays , public holidays , and current gold rates and silver prices in your area.
Time of India
28 minutes ago
- Time of India
Economy outlook: RBI Governor at MPC meet says economy shows strength and stability; cautions on tariff uncertainty and inflation risk
The Indian economy presents a picture of strength, stability and opportunity, Reserve Bank Governor Sanjay Malhotra said at the Monetary Policy Committee (MPC) meeting earlier this month, while cautioning that monetary policy must remain vigilant amid evolving uncertainties around US tariffs. The Reserve Bank of India on Wednesday released the minutes of the MPC meeting held from August 4 to 6, where Malhotra and five other members voted to keep the short-term lending rate unchanged at 5.5 per cent, PTI reported. 'Overall, our economy presents a picture of strength, stability, and opportunity. India's strong fundamentals, growth-inducing policies, and forward-looking economic strategy clearly place it in a strong position,' Malhotra said, as per the minutes. He added that while growth has been steady, inflation outcomes have turned more benign on the back of food price moderation. 'Although we are likely to see inflation undershooting the target in the near term, with a likelihood of monthly numbers even crossing the lower tolerance band of 2 per cent, headline inflation is projected to inch up from Q3 onwards. The uncertainties of tariffs are still evolving,' he said, stressing the need for a watchful policy approach. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Earn Upto 5k Daily By This Method of Intraday Trading TradeWise Learn More Undo The Governor also noted that the cash reserve ratio (CRR) cut, which will come into effect from next month, would aid monetary transmission and support economic activity. Deputy Governor Poonam Gupta backed a status quo on rates, stating: 'Taking into account the growth-inflation outlook, past actions, the state of the domestic economy, and the global dynamics, I do not see the scope or rationale for a further policy rate cut at this point.' She favoured a neutral stance so that future actions remain data-driven. Executive Director Rajiv Ranjan observed that while growth remains resilient on the back of public capex, rural demand and steady services activity, industry continues to show uneven performance. 'An additional rate cut at the current juncture could also reduce our policy space should global or domestic risks materialise,' he said. External members also supported the pause. Ram Singh stressed the importance of policy flexibility in a volatile environment, while Saugata Bhattacharya argued that given the fluid macro-financial situation, a pause was appropriate. Nagesh Kumar added that while benign inflation provides policy space, it was prudent to 'wait and watch' the impact of transmission and trade policy shifts before acting further. The MPC, comprising Malhotra, Gupta, Ranjan, and three external members, met against the backdrop of easing inflation but persisting global and domestic growth concerns. Stay informed with the latest business news, updates on bank holidays , public holidays , current gold rate and silver price .
