Latest news with #SiraliGupta
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Business Standard
2 days ago
- Business
- Business Standard
Earnings in downturn; FPI inflows unlikely in short-term: TRUST MF CEO
With the Reserve Bank of India (RBI) lowering its inflation projections and Indian households increasingly shifting their savings from bank deposits to equities, the country's investment landscape is undergoing a transformation. In an email interview, Sandeep Bagla, CEO, TRUST Mutual Fund, tells Sirali Gupta about the implications of these changes, the resilience of domestic flows, the outlook for corporate earnings, and how artificial intelligence (AI) is reshaping the mutual fund industry. What does the RBI's move to lower inflation projection mean for the market? Headline CPI numbers will be quite low for the next few months as food inflation has been low, and there is a favourable base effect. RBI pointing towards stubborn and rising core inflation is concerning and tells a different picture from that portrayed by the falling headline numbers. It is clear that the RBI will not ease the policy rates unless growth tapers off significantly in the near future. The RBI Governor in the MPC said that household savings are gradually shifting from bank deposits to equities. What is driving this behavioural change? Indian investors have understood that equities/mutual funds are the best way to beat inflation and participate in the structural growth story in a tax-efficient manner. Government is also happy, as mutual funds are an efficient way to convert savings into productive investments. The trend of savings converting to equities is a megatrend and is likely to gather pace with time. The growth of the SIP book is encouraging, as it implies widespread risk dispersion and sharing. How do you view Indian equities compared to global peers? Indian equities have always been optically more expensive compared to other markets due to a superior and diversified structure in terms of conventional valuation ratios like price to earnings. Over a long period of time, the demographic dividend and governance framework should result in a long runaway of growth for the Indian economy. Short-term corrections may offer attractive long-term investment opportunities. FIIs are pulling out of Indian equities. Is this a short-term trend or a strategic shift, and how long can domestic investors hold fort? Globally, central banks have been resorting to mild quantitative tightening, reducing the supply of money. As a result, money has dried up and is being allocated selectively across riskier asset classes. The threat of higher inflation has led to spiking bond yields and higher gold and crypto prices. I am not counting on a structural inflow from FPIs in the short run. The domestic flows are likely to continue. More than the flows, a pick-up in earnings outlook would help boost market prices and sentiment. What is your outlook on corporate earnings? Which sectors do you expect to lead the rebound? We are experiencing a cyclical downturn in earnings. Interest rates have been reduced, and government capex has been frontended to a great extent. Low food inflation could bolster earnings as well. A few niche sectors like hospitality, could do well in the near future. How do you view the primary markets? Are they experiencing a rebound? Primary markets remain strong, though many new listings have underperformed. Still, companies will continue to tap the market, offering investors opportunities to invest in promising franchises over time. SIP flows have remained resilient despite market volatility. What's your advice to investors using systematic investment plans in the current environment? A weak market lets long-term investors buy equities at lower prices. Staying disciplined with SIPs and seeking advice from a qualified distributor can help select the right funds and benefit from compounding in Indian equities. AI is beginning to reshape many aspects of the mutual fund industry. How is your firm embracing this shift? AI is a powerful productivity tool, and I'm amazed by the constant stream of new use cases. We have adopted emerging technologies while prioritising compliance, cybersecurity, and integrity. Beyond internal benefits, I'm optimistic about the productivity gains and investment opportunities AI offers our investors.
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Business Standard
01-08-2025
- Business
- Business Standard
Markets are ignoring positives at the current levels: Mohit Bhatia, BOI MF
Nifty50's earnings per share (EPS) growth rate is expected to be around 12-14 per cent compound annual growth rate (CAGR) over FY25-27, which translates to an earnings per share (EPS) of around ₹1,180 Sirali Gupta Mumbai Listen to This Article Revenue growth inching up can pull Indian equities out of consolidation, says MOHIT BHATIA, CEO, Bank of India Mutual Fund, in an email interview with Sirali Gupta. Bhatia believes India is coming out of its slow-growth patch of the past few months, and that the market is particularly ignoring a slew of recent positive developments. When is the market consolidation phase expected to end, and what could trigger a breakout? Over the past year, markets have struggled amid weak earnings profiles. While EPS has grown—except in the first two quarters of the last fiscal—this was largely due to margin expansion from cost
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Business Standard
17-07-2025
- Business
- Business Standard
See valuation challenge if earnings growth stays tepid: Pramerica Life CIO
Market outlook: In an email interview, Abhishek Das, chief investment officer, Pramerica Life Insurance said that Nifty earnings are projected to grow 7-8 per cent for the year premium Sirali Gupta Mumbai Listen to This Article Nifty earnings are projected to grow 7–8 per cent for the year, says ABHISHEK DAS, chief investment officer, Pramerica Life Insurance in an email interview with Sirali Gupta. Das believes debt could be a diversification option. Edited excerpts: Can markets sustain their rally in H2-2025? What are the key downside risks? Indian markets may remain volatile in H2-CY25 due to global uncertainties and tariff-related risks. While strong domestic indicators— 7.4 per cent Q4 GDP (gross domestic product) growth, easing inflation, and Reserve Bank of India's (RBI's) liquidity support—are positives, external shocks due to global trade policies as well as geopolitical turmoil
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Business Standard
02-07-2025
- Business
- Business Standard
Oil, trade deal concerns priced in by markets: Unmesh Sharma, HDFC Sec
In an exclusive interview, Unmesh Sharma, head of institutional equities, HDFC Securities, discusses FII flow, trade tariffs and market outlook Sirali Gupta Mumbai Listen to This Article As the July 9 US tariff deadline nears, UNMESH SHARMA, head of institutional equities, HDFC Securities, tells Sirali Gupta in an email interview that though the impact on the markets is unlikely to be major at the aggregate earnings level, the largest impact at the sector level, if any, would be on defence and oil procurement. Edited excerpts: As the July 9 trade tariff deadline is approaching, how do you think potential changes could affect the market sentiment and specific sectors? We are of the view that India will close a deal with the US, which will be a
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Business Standard
18-06-2025
- Business
- Business Standard
Smallcaps offer Alpha; midcaps look expensive: PGIM India's Aniruddha Naha
Amid the ongoing conflict in West Asia, ANIRUDDHA NAHA, CIO – Alternates, PGIM India Asset Management Company, cautions investors that a sharp rise in crude oil prices could pose a significant risk to India's economic stability. In an email interview with Sirali Gupta, he also suggested taking some money off midcaps given its high valuations. Edited excerpts: What are the key challenges that could weigh on Indian equities? The risk for India emanates from higher crude oil prices. Crude happens to be one of the largest imports for India and accounts for almost one-third of the import bill. Any geopolitical event that drives crude oil prices higher in a dramatic fashion would have implications for the Indian macro and could hurt the economic stability of the country. Should investors exit or trim exposure to any segment in this market? India probably offers one of the best equity markets to create wealth over the next decade. However, the segments where we see valuations on the higher side and one can take some money off the table is midcaps. Given the limitation of how midcaps are defined and are limited to 150 companies, continuous inflows in this segment leave limited upside in the near term. What are the themes you are optimistic about over the next 12–18 months? We remain positive on the revival of the investment cycle, now supported by improving data on private capex and rising government spending. With deleverage balance sheets and recovering demand, corporates are well-placed to invest. Consumption, especially lower-ticket discretionary spending, should benefit from income tax cuts and rising per capita GDP. What are the key advantages of long-only alternate strategies, especially in the context of small and mid-cap investing? Alternate strategies have the flexibility of being agnostic to benchmarks both in terms of market capitalisation and companies. This helps in building portfolios that could have very low overlaps with a benchmark and build a differentiated portfolio. One can limit the asset under management (AUM), which makes a lot of sense in small-cap portfolios. How do you generate alpha in smallcap stocks? While large and midcaps are well-defined, smallcaps include companies beyond the top 250 by market cap. As we go lower, one can fine manu undiscovered opportunities. We scout from a universe of nearly 4,000 companies, down to ₹500 crore in market cap. Given the growth potential and attractive valuations, we believe small caps offer the best alpha generation opportunities. Do you see alternate funds becoming part of mainstream investing? As per capita gross domestic product (GDP) rises and financialisation of savings takes centre stage over a period, the demand for Alternate assets will keep growing. Not only listed, unlisted but other asset classes will get introduced in the country. Having said that, Alternates will be a solution provider for spaces, where the mutual funds do not have a solution. They will be peripheral to the core mutual funds, but their share and innovations will keep increasing and driving their relevance. Your PGIM India Equity Growth Opportunities Series II Fund expects 28–30 per cent earnings growth in FY26 and FY27. What's driving that confidence? We believe there are still ample opportunities in small caps to generate alpha. Our focus is on identifying companies with strong earnings visibility—often quality businesses at the bottom of their cycles. As the cycle turns, earnings rebound and, with improved sentiment, there's potential for both earnings growth and P/E expansion.
