Don't Foresee Risk of Large-Scale Outflows from Indian SIPs

We are seeing value emerging in large-caps as well as in select mid-and small-cap stocks. Mahesh Patil CIO, Aditya Birla Sun Life Asset Management Co

- Ram Sahgal

Despite stocks, especially small caps, correcting steeply from their highs of September, markets could still undershoot on the downside as investor sentiment remains weak. However, they aren't likely to stay there for long, according to Mahesh Patil, chief investment officer of Aditya Birla Sun Life Asset Management Company Ltd.

Patil cites data indicating that the median stock in the broader market (BSE 500) has fallen more than 37% from its peak, a level at which markets tend to bottom out during a normal correction phase.

He also doesn't expect large-scale outflows from mutual fund investors.

Edited excerpts:

GDP growth and earnings have slowed amid global trade tensions. How will Indian markets fare given that valuations aren't exactly cheap, and we are close to the election results-day low?