Indian fund managers see earnings revival, eye opportunity in consumption

Indian wealth and alternative investment managers expect the next federal budget to propose measures that will improve consumption and bolster infrastructure to revive economic growth.

Newly appointed Finance Minister Nirmala Sitharaman will present her first budget on Friday. Growth slowed to a five-year low of 5.8% in the first three months of 2019, amid a liquidity crunch at non-banking financial companies. That’s put pressure on recently re-elected Prime Minister Narendra Modi to deliver on a stimulus plan.

Umang Papneja, senior managing partner, IIFL Wealth Management shares his views on the current opportunities in the market:

  • The liquidity squeeze due to the credit crisis has created an investment opportunity
  • The “flight to quality" trend since September is likely to continue for some time
  • Spotting some good ideas amid the turmoil in the real estate sector; introduction of a regulator may help drive consolidation; stronger players are likely to get cheaper credit
  • It’s a “divergent time" for equities, as only a few stocks are driving the indexes higher; it’s time to gradually start investing in select mid-caps stocks after a sharp correction


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