Summary
Vetri Subramaniam, CIO and Ajay Tyagi, head Equities, UTI mutual fund on their perspective on Economy and post-election outlook on markets, valuations, and investment options.
Highlights
- Indian Economy
- a decade of macro-economic stability with fiscal discipline, inflation targeting and a supply side focus with measures like corporate tax cuts, PLI, Government capex…
- Post election we may have a slight shift towards demand side
- Low corporate leverage and strong bank balance sheets enablers for growth
- Spread of policy rate and inflation is 2% leaves room for rate cut late this year
- Valuations
- Nifty 50 consensus earnings growth 18% for FY 25 and 15% for FY 26
- Smallcaps and midcaps trading at a premium to nifty 50 index.
- Investment outlook
- Investors should adopt a staggered approach towards equity with bias towards large caps
- Balanced advantage, Multi asset and Equity savings fund better for lump sum investments
- Positive on banking and financials and Healthcare
- Investors can consider SIP in innovation fund.
- UTI Flexi cap fund
- UTI Flexi Cap scheme focusing on high-quality businesses
- Relative underperformance due to underperformance of quality.
- Expect Quality to outperform over the next 1-2 years.
