"POCKETS OF VALUE EMERGING"

Navneet Munot, MD and CEO of HDFC Asset Management Company, on why India’s fundamentals will remain strong despite foreign institutional investors shifting focus to China

- BY SHAILENDRA HATNAGAR

NAVNEET MUNOT, Managing Director and CEO of HDFC Asset Management Company, oversees one of India's largest mutual funds that manages equities worth 5 lakh crore. In addition to fund-of-fund schemes and exchange-traded funds, it offers a comprehensive range of mutual fund schemes across equity, debt, and hybrid categories.

Munot speaks to BT about navigating the downturn in India's benchmark indices, driven by selling from foreign institutional investors (FPIs). Edited excerpts:

There seems to be a lack of vibrancy (in the market). What are your thoughts?

It depends on one's perspective. If we look at the last six months since the peak in September 2024, there has undoubtedly been a decline.

However, if we consider a broader horizon-say, three or five yearsinvestors have still seen significant gains. Five years ago, the Nifty dropped below 8,000 and has now grown nearly 2.7 to 2.8 times that value. Small and mid-cap stocks, though having undergone corrections in the last six months, have more than tripled over the past five years.

Short-term market movements are difficult to predict. A few months ago, we noted that valuations were high, with prices outpacing fundamentals and market narratives exceeding actual numbers. Now, after various corrections, market valuations have adjusted.