Latest news with #AsitBhandarkar
Mint
06-07-2025
- Business
- Mint
India Inc sits on ₹5 trillion cash pile as firms hold back on capex amid uncertainty
Amid a patchy demand recovery and lingering global uncertainty, India Inc. continued to hoard cash in the last fiscal year, choosing financial buffers over fresh investments. Despite rising profits and healthy balance sheets, companies showed little urgency to deploy capital, preferring to return more to shareholders instead. A Mint analysis of cash holdings of 285 BSE-listed firms, excluding banking, financial services and insurance companies, showed a 12% year-on-year rise to ₹5.09 trillion in FY25. Yet, new project announcements fell 5% in the same period, following a 3% contraction in FY24, according to the Centre for Monitoring Indian Economy's (CMIE) project-tracking database. Companies are now sitting on cash and cash equivalents amounting to nearly 12% of their total assets. The rising number of firms with high cash ratios also points to subdued confidence in future business prospects. Between FY24 and FY25, more companies positioned themselves defensively, holding 25-50% of their assets in highly liquid form, the analysis showed. With no broad-based demand revival since the pandemic, there's little incentive to reinvest profits. Rather, in the absence of sustained revenue growth, many firms have relied on cost optimization and price hikes to maintain profitability. Still, flush with cash, many companies rewarded shareholders handsomely. A separate Mint analysis of 496 BSE 500 companies showed dividend payouts rose 11% on year in FY25 to ₹4.9 trillion—the highest in at least a decade, outpacing net profit growth of 9.5%. That suggests India Inc currently prefers sharing profits with investors over committing to long-term expansion. Recovery ahead? The big question now is when that investment impulse might return. Many experts believe a pickup in investments may hinge on global clarity—particularly a long-awaited US-India trade deal. President Donald Trump's reciprocal tariff pause ends on 9 July, and firms appear to be holding off until there's more certainty on that front. Asit Bhandarkar, senior equity fund manager at JM Financial Asset Management, notes that a lot of projects are in 'blue-print" mode and would be led by both organic and inorganic expansion plans. "The rising number of performing credit deals also indicate that money is being raised to improve existing capacities as well," he said. On a more optimistic note, Pankaj Pandey, head of retail research at ICICI Securities, expects a sharper rebound in corporate investments in FY26, especially after private capex outpaced government spending last year. He expects energy, utilities, metals, automobile and industrial goods sectors to lead the capex cycle this year. Adding to that, Raghav Narsalay, research lead and partner at PwC, pointed out that many firms now aspire to become global value chain leaders. 'So everyone wants to deploy cash wisely, even though money is getting cheaper to borrow." Alternate avenues Beyond dividends, some of India Inc.'s war chest may also be channelled into product innovation and service enhancements. In order to drive topline growth from here on they are gearing up to expand their customer outreach, said Narsalay. 'Companies are now looking to innovate products, reinvent their business models and overall offer better value propositions to lure back customers. They are more willing to experiment with technology rather than buy lands or machinery immediately," he added. Meanwhile, with fortified balance sheets and relatively low leverage, firms have ample room to borrow for acquisitions. Total debt level rose just 5% in FY25, following a slight contraction in FY24, the analysis showed. 'Since raw material prices are not at peak levels and there is not much stress in balance sheets, they can also borrow for inorganic expansions," noted Pandey from ICICI Securities. Strong cash flows and high profitability, coupled with cooling valuations and improved liquidity, have triggered a wave of consolidation in several industries. Cement, cables, paints and healthcare have seen a particular pickup in acquisition activity, said JM Financial's Bhandarkar.
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Business Standard
04-07-2025
- Business
- Business Standard
NFO alert! JM Financial MF launches Large & Midcap Fund; check details here
JM Large & Midcap Fund: JM Financial Mutual Fund has launched its JM Large & Midcap Fund, an open-ended equity scheme investing in both largecap and midcap stocks. The new fund offer (NFO) will open for public subscription today, July 4, 2025 and close on Friday, July 18, 2025. The scheme aims to generate long-term capital growth through investments in high-quality growth stocks with superior management quality and corporate governance standards. The fund house will use the in-house GeeQ (Growth of Earnings and Earnings Quality) model to find investible opportunities. The portfolio strategy of the scheme focuses on liquidity and flexibility. The fund will maintain a minimum 35 per cent allocation each in largecap and midcap stocks, with the remaining 30 per cent providing flexibility across market capitalisations. 'With our new Large and Midcap Fund, we bring together the stability and resilience of blue-chip giants and the growth potential of emerging leaders. This is not just another scheme- it is a powerful blend of scale and rapid growth, designed to seize tomorrow's opportunities," said Asit Bhandarkar, senior fund manager for equity at JM Financial Asset Management. According to Bhandarkar, the Indian equity markets are undergoing a period of heightened volatility, where a product which has a return profile closer to midcaps and the risk profile closer to large caps could offer investors a better experience. We are confident that our growth and quality-focused investment philosophy, a disciplined and process-driven investment approach and a seasoned equity fund management team could help us navigate these turbulent times and create a resilient portfolio which may enable wealth creation for investors,' he added. Asit Bhandarkar and Deepak Gupta are the fund manager and co-fund manager, respectively, for the scheme. According to SID, if the units are redeemed or switched out within 180 days from the day of allotment, an exit load of 1 per cent will be charged. However, no exit load will be charged if units are redeemed after 180 days from the date of allotment. According to the riskometer, the principal invested in the scheme will be at very high risk. JM Large and Mid Cap Fund: Who should invest? According to the SID, the product is suitable for investors seeking long-term wealth creation and capital appreciation by investing predominantly in equity & equity-related securities of large and midcap stocks. However, investors should consult their financial advisors if in doubt about whether the product is suitable for them.
Time of India
11-06-2025
- Business
- Time of India
ETMarkets Smart Talk: Defence stocks may face bumpy ride despite big potential, says Asit Bhandarkar
There may also be opportunities to turnaround in sectors where either fundamentals and valuations or both have bottomed out. JM Financial's Asit Bhandarkar advises caution on defence stocks despite long-term potential, citing long execution cycles and potential volatility. He highlights India's sweet spot with strong finances and growth amid US bond yield concerns. Bhandarkar also notes attractive opportunities in corrected markets, focusing on financialization, consumption, and manufacturing themes for long-term investors. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads As geopolitical tensions rise and investor interest in defence stocks surges, JM Financial Asset Management's Senior Fund Manager – Equity, Asit Bhandarkar, urges an exclusive conversation with ETMarkets Smart Talk, Bhandarkar acknowledges the long-term potential of India's defence sector, especially with increasing private sector participation and innovation around drones and modern he warns that execution cycles may be long and initial investor euphoria could face unexpected challenges, making the investment journey in defence stocks uncertain and volatile in the short term. Edited Excerpts –A) Tariffs are a developing story. Although it led to significant volatility in the first quarter of the calendar year, as things stand, markets have figured that perhaps, the tariffs in their final form may not be as negative in their quantum as initially Indian government as well as corporates are attempting to convert this challenge into an opportunity to strengthen our exports to the US and capitalise on the China plus sentiment.A) Drones have higher impact than expensive military aircrafts and is a classic sign of high disruption ahead. Fundamentally, war strategies are getting redefined. New wave of innovation and imagination will drive the future outlook a stock market perspective, popular stories seldom make money in the short term. We feel that execution cycles will be long and initial euphoria may face unexpected challenges making the journey uncertain and said we are positively inclined about the role of the private sector participation in development, production and even export of defence equipment.A) US bond yield strengthening have had their unique dimensions this time around given the outlook on US inflation, the deficits that the US government has been running as well as the uncertainty on growth created by the tariff said, we are yet to see a closure of the tariff situation. Lowering of uncertainties on that front can clearly reduce the risk premium on the said, it's likely that capital in US may be looking to diversify given the unprecedented uncertainties presented by the tariff related uncertainties leading to a prolonged weak growth between India and US yields are at their lowest in recent times but India is in a sweet spot in terms of strong government finances, benign inflation and improving growth is indeed likely that flows continue to move towards geographies with higher growth and lower uncertainties. India definitely shines on that front.A) As the portfolios bore the brunt of the volatility driven by the tariff announcements, we did have to restructure our portfolios to maximise sectoral overlap with the benchmark as well as increase liquidity as a risk management measure, in case we got into a long drawn like BFSI , which have been suffering anemic growth, managed to outperform as regulatory tailwinds kicked along with FII things stand, broader markets have sharply corrected from their peak last year while macros have steadily improved with ample liquidity, lower rates and improving corporate are now in a position to add newer stocks across market caps, thanks to attractive opportunities thrown up by the sharp correction in prices and stability in market conditions. Market is starting to focus on growth stocks again.A) YoY and QoQ growth rates excluding BFSI were at 10.1% and 18.2 % for S&P BSE 500 Index based on our sectoral analysis of Q4FY'25 numbers (source: ACE Equity, JMFMF Research).Sector wise Chemicals , insurance, telecom, consumer durable, retail and electricals showed a sharp improvement in operations yoy. However, large sectors like Banks, FMCG, IT and autos exhibited anaemic appear to be on the cusp of an earnings recovery into FY 2026 as we face a low earning base from last year and improving government spending, lower taxes leading to consumption uptick, improved liquidity and lower rates to push up demand as well as private capex.A) The IPO markets have cooled down versus last year. There is much lower interest and there has been a moderation of valuation a long-term investors perspective, it may be a good time to allocate to few issues that come along as valuations might be more rational than in the previous year. SME space, which has gathered more interest so far in 2025 as compared to mainboard IPOs? Do you see froth building in this space or an opportunity for long-term investors?A) Mutual funds had mostly sidestepped the euphoria in the SME space and this shows the maturity and the discipline of investment processes at an industry a price, given the sharp correction all across, there might be opportunities available. But most of the businesses in the SME market may not be at scale where mutual fund investors find the risk reward palatable.A) Financialisation, formalisation, aspiration driven consumption and a manufacturing renaissance driven by china+1 remain strong themes, driven by global geopolitics and rising per capita income back of these themes remain expensive, given the higher visibility. Sharp corrections give us an opportunity to build positions in long term structural themes at reasonable may also be opportunities to turnaround in sectors where either fundamentals and valuations or both have bottomed out.(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
