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, Founder & MD,, says his advice to investors and own strategy is to drip money in because it is very difficult to call the bottom in this market. Rather than going all in, we should figure out what you want to invest in and keep investing in it over the next two to three months in a systematic manner. So, to answer your question, yes, we are definitely looking at this as a buy-on-dip market rather than a sell-on-rise market.The market has been changing its texture. If you go back over the last six months. Around November, December was the time that it stopped being a buy-on-dips market and started converting itself into a sell-on-rise market and it stayed there till March when the FPI selling was peaking out. But what we are seeing now is that there is more confidence that the domestic consumption in India that had fallen off the cliff in the December quarter is now coming back, driven by lower interest rates, more liquidity in the system and better consumer sentiment.As a result, after earnings downgrading over the last two quarters, this quarter the commentary is better and more positive. This is giving the investors the confidence that the earnings growth has probably bottomed out and will revert to a mean of 10% to 15% for the next three to five years. That is the belief with which long-term investors are willing to make their bet in the market.At the same time, there is this overarching fear of geopolitical tensions and something happening at any point of time which is the reason that domestic investors are not fully in. So, I see a dichotomy here from the last quarter that the foreign investors are now continuously looking for opportunities in India whereas the domestic investors are more cautious. My personal view is that the valuations are reasonable. There are growth opportunities . There are good growth sectors that are turning around from cyclical bottoms that will reward investors who are patient and not worried about daily volatility or weekly volatility.At the same time, our advice to investors is and our own strategy is to drip the money in the markets because it is very difficult to call the bottom in this market. So rather than going all in, figure out what you want to invest in and then keep investing in it over the next two to three months in a systematic manner. So, to answer your question, yes, we are definitely looking at this as a buy-on-dip market rather than a sell-on-rise market.One sector that we have been tracking and which we believe has already made or is in the midst of making a cyclical bottom is the entire small finance bank and lenders who do unsecured lending and also the larger banks. Frankly, that whole segment of banking and financials, NBFCs that lend to the middle to bottom of the pyramid, have a very solid branch network, branch presence, and the ability to generate deposits. This whole sector got beaten down over the last quarter largely because of very aggressive guardrails put in by RBI which led to lesser liquidity in the system, lesser money flow to them and everybody just focused on collections rather than increasing the book size.But in the current construct, it looks like RBI has now come to a conclusion. The recent steps that they have taken show that they want to put back more liquidity in the system. They do not want to starve the entire bottom of the pyramid borrowers from credit. It is very essential that that sector that is largely self-employed continues to have access to credit. So, through credit guarantee schemes under which money is flowing to even microfinance lenders, there is optimism that that sector has kind of bottomed out.We are of the view that this is a good time for investors to look at these smaller banks and NBFCs that are trading at either one-time book value and some even below that, but you will need to be able to take a two- to three-year perspective to make pretty good returns because this sector is a cyclical sector. We have seen the last three cycles, it bottoms out and then again aggressive lending takes place and when the valuations rise. So, this is one sector that we are quite bullish on.The second sector is the entire pharma space for us. Again, it has not bottomed out, it has been the best performing sector, so not really a sector that we are saying has bottomed down cyclically but we believe that this is a sector that lot of hard work has been done in terms of creating a very solid product pipeline for exports to US market especially.So, there is a very positive demand environment in the US for Indian companies, and a very friendly US FDA after a long period of time. All systems go for Indian pharma companies that are exporting to the US. So, these are two sectors we are pretty positive on.The whole objective of the tariff realignment by the US government, the US president was not to create chaos in the global trade but to signal to the rest of the world that they cannot use the US as a dumping ground for their products and build on the other side tariff structures for inbound imports into their own country from the US.As long as that problem is largely solved, the US tariffs are not going to hurt anybody in the medium to long term. There is a lot there and there are aggressive posturing and then there are back steps taken to make sure that nothing goes out of whack for the US customers. India especially has been a smaller trade partner for the US. I mean what we export to the US does not really hurt us. It is textiles. It is some bit of chemicals and gems and jewellery and services is one of the big parts.What we import from the US are automobile parts components, electronics, semiconductors, and higher technology items, electronics being top of that. It is a trade structure where it is easy for both the countries to come to terms and my personal view is that India will benefit from this kind of tariff structure, especially for textile exports and chemical exports. There were other countries that had more favourable tariff structures to the US and Europe and if India realigns, it is a golden opportunity for Indian exporters and the Indian government to benefit from the new tariff structure and generate higher trade activity with the US.
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