'Consumer sentiment in the market seems generally positive'

Suresh Soni, CEO of Baroda BNP Paribas MF, highlights a decline in India's price-earnings premium to other emerging markets, expecting Systematic Investment Plan (SIPs) to persist as a favoured investment method despite a shift in foreign portfolio investor focus towards developed markets.

- Ram Sahgal

The recent market correction has meant a reduction in the price-earnings premium of India over other emerging markets from around 20% levels to 13-14%. The near-term trend of greater investor flows towards developed markets will keep the India premium in check, believes Suresh Soni, CEO, Baroda BNP Paribas MF. This notwithstanding he expects SIPs to continue as an effective and convenient mode of investment with Indian investors having enjoyed the benefits of staying invested in volatile markets and the power of regular investments in equity markets. Edited excerpts:

The NSO first advance estimate of 6.4% GDP growth is below RBI estimate of 6.6%. What does this tell you of the earnings performance for the second half of the year given the tepidity of the Q2 earnings?