Based on the sea lion’s long-term investment philosophy, Jain outlines why India’s structural growth remains intact. This is facilitated by three key pillars: democracy, demand and demographics.
He delves into how these fundamental strengths create multi-year opportunities for investors and why disciplined governance-first investments are important in navigating today’s markets.
From sector preferences to managing corporate governance risks, Jain offers timely advice to high-net individuals looking to build a resilient portfolio in a dynamic macro environment. Edited excerpts –
Q) Thank you for taking the time. May began with a volatile memo containing a benchmark index that witnesses wild shaking on either side. How do the market read?
a) May volatility is primarily a function of mixing global signals and sector rotations that play in real time. There is a tug of war between US sticky inflation data, speculation about the federal government’s next move, and ongoing geopolitical tensions that are curtailing global risk appetite.
Despite geopolitical uncertainty, the Indian market demonstrates resilience, supported by strong corporate revenues, robust domestic consumption and sound credit growth.
At Ashika Global Family Office Services, we consider this volatility to be a healthy reset. Allows the market to consolidate before the next leg.
We advise clients to continue investing and remain inventory and sector-specific and to accumulate high conviction ideas using modifications. This is not a time of widespread attacks, but a moment of focused and disciplined investment.
Q) What is your feeling from the results of the March quarter? Is there more downgrades this time than upgrades?
a) The results for the March quarter were mixed bags, but overall, they reaffirm the resilience of the Indian corporate sector. The basic effects and softening global demand have eased top-line growth in some sectors, but widening margins have been a significant positive. In particular, segments such as the selection industry, where manufacturing, automobiles and selection costs are significantly lower, the conditions for revision are quite balanced. Global headwinds have seen downgrades in sectors aimed at several exports, such as IT and chemicals, but they have also been upgraded in domestic-oriented sectors such as banks, capital goods and consumer discretion.
At Ashika Global Family Office Services, we believe the market will reward companies for demonstrating cost efficiency, pricing power and a strong balance sheet.
A key point in this revenue season is that leadership is becoming narrower and investors need to look selective and future-proof in their approach.
Q) We’ve seen the results of Indusind Bank and there’s a possibility that more skeletons will come out of our closet in the near future. What should investors do when they are invested in these types of companies with corporate governance issues?
a) Corporate governance cannot be negotiated in the current market environment, especially in which capital is discernible and trust is paramount.
Cases like those seen at Indusind Bank serve as reminders that strong finances aren’t enough. The quality of management and governance practices is equally important.
We are always advocating a “governance-first” approach to investment. Whether it’s a lack of transparency, aggressive accounting, or a board-level issue, if you have a red flag, you prefer to come aside, even if your inventory looks attractive in your ratings.
For investors who currently hold such names, it is important to reassess the risk compensation framework. If trust is eroded, capital conservation should take priority over potential benefits.
In such cases, a gradual exit that becomes phased clean is the most careful path through which fundamentally powerful alternatives often advance.
Q) What is the long-term outlook for Indian equities over the next few years?
a) At Ashika Global Family Office, our investment philosophy is fixed in India’s structural strengths. This is called the 3DS, which is democracy, demand and demographics.
These are more than just buzzwords. They form the basis of India’s long-term growth story and why they continue to remain firmly bullish on Indian stocks for the next three to five years.
A robust democratic framework ensures policy continuity and institutional strength. Rising domestic demand, driven by ambitious consumption and increased urbanization, provides a solid foundation for revenue growth.
With a young and tech-savvy population, our demographic dividends are set to fuel productivity and innovation across the sector. Together, these drivers make India a structural multi-year opportunity.
Volatility goes back and forth, but for long-term investors focusing on quality business and strong governance, Indian stocks will continue to be a powerful engine for wealth creation.
Q) Which sectors will provide strong returns in the future? Are there any safe bets investors can consider?
a) You remain selected for banks, FMCGs, and PSUs such as capital goods and power. Banking is benefiting from strong credit growth and improved asset quality, while FMCG is mitigating input costs and is supported by a recovery in rural demand.
PSU in capital goods and power sees a structural reassessment thanks to the focus of government infrastructure.
For conservative investors, large quality stocks in these sectors offer relatively safe and stable opportunities for India’s long-term growth
Q) How can high-net individuals effectively build wealth in the current market environment?
a) High-fed individuals should follow the sea lion’s investment philosophy and switch in a timely manner. Initially, you need to invest in quality businesses with strong foundations and actively adjust your portfolio as market conditions change.
Balancing growth and capital conservation through disciplined stock selection and timely portfolio shifts, while focusing on governance and sustainable cash flow, is key to building resilient wealth amidst volatility.
Q) What do you think about Gold? Recently, it has exceeded 1,000 rupees in the physical market. Should investors wait for a cool off if it’s the right time to increase their allocations?
a) Gold has historically served as a reliable hedge against global uncertainty and unstable markets evident from aggressive purchasing by central banks in recent years.
However, as macro conditions gradually become more stable, gold safe haven appeals could decline as investors’ sentiment returns to stocks.
At this point, it may not be the most appropriate time to enter your money. Investors will provide better service by observing how global dynamics unfold before making new allocations.
(Disclaimer: recommendations, suggestions, opinions and opinions given by experts are unique. These do not represent views of the economic era.)
