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"We got our final licence to commence the AMC operations in March 2023, by which time, our entire leadership team and their next line were in place. As we’re the 41st AMC and we’re building it from scratch, we believe we have a last mover advantage - that is, the ability to learn from domestic and international players in the industry, see what works and what needs to be made better, implement best practices, take a hard look at processes that need to be fixed, and finally build a future-ready AMC," says Ganesh Mohan, CEO, Bajaj Finserv Mutual Fund.
Our ETFs have got flows like the industry and incidentally in the ETFs also we have seen some profit booking last month. So across board, people are taking off some money off the table.
The RBI certainly seems to be on a pause mode. And in fact, global central banks also, especially the US Federal Reserve, also seems to be indicating that they would pause soon.
In about 20 years, these six states have reached where India was yesterday. Now, if all of us continue to work in similar fashion for next 20 years, these six states will create today's five India.
So, one problem is in a way out of the way and alongside which we have also seen actually interest rates presumably going into a bit of a pause mode as far as we can understand and which is again a little better than our expectations because that was supposed to come about more in the second half of the year which basically means that PE multiple decline from year essentially is arrested and that problem at one level is out of the way.
"Due to the recent changes in debt taxation, there could either be some change to our existing hybrid scheme or a new scheme offering may be considered given the changed environment. Our preference is not to launch too many schemes and clutter the offering," says Neil Parikh of PPFAS Mutual Fund.
But my own belief is as interest rates start coming down the next year and supported by good growth coming in, probably we should see some kind of premium valuation starts coming in, which probably should see it coming in next year.
I think a lot of it has to do to my mind with two or three things. One is your external account situation obviously has gone through a sea change because energy prices are down, service exports have done well. The dollar itself has weakened.
I am sure looking at all angles from this thing, from the investor point of view, from the industry point of view, from the intermediary point of view and more than anything else keeping in view the growth of the industry, I think the final whatever will come will be for the benefit of everybody.
10-year bond yields are expected to start rallying due to inflation and weakening macroeconomic data. Rate cuts are expected to be built in over the next six months, and from RBI's perspective, around 50 bps of rate cuts are anticipated in the next year. Interest rates are expected to move lower, causing the addition of duration to all portfolios. Long bonds will perform well initially and short-term funds when rate cuts occur. Corporate bond spreads are attractive for the three- to five-year segment.
So I think the impact on the listed players would be minimized to the extent that they will benefit from larger flows, I would say, because their costs would be much lower compared to a smaller AMC.
And not necessarily that every recommendation that is coming in would pass through or would get accepted or would get rejected. Therefore, one has to just see within this which are the one would actually be dropped.
There are cycles in the market between so-called value and growth and quality. I think as you really see inflation coming off, the interest rate cycle coming to a pause, if not on the cutting side, I think that leads to a significant amount of momentum on the growth side of the macro economy and at the same time growth side of the market.
We have generated more than 20% cumulative alpha over the last 2 years. Since the last 8 months, I have taken over the flexi fund which has started to see early signs of turnaround by being in the top quartile within 3 months.
I think we are in the middle that is the challenge that you do not have a situation where I do not think we are in greed, if you have greed you will have huge local mutual fund inflow.
The rate cut cycle, when it starts in the US there will be a slowdown coming. So what happens with domestic advisors is that when they sense this, they tend to move into small and midcap stocks versus large cap stocks
So since we try to capture both legs of the data, we see opportunity also like you look at today also, some of the stocks have corrected sharply since I talked about the impact.
"Last year was a goldilocks scenario and we are not expecting the same mid teen growth. We are expecting to maintain a slightly lower than mid teens growth in the banking system this year. But if that steady growth comes with no spike in credit cost and even if a little bit of margin hits takes place, even then banking earnings would be quite resilient compared to most of the sectors in the system. "
