Amid the volatile market and global concerns, ICICI Prudential Asset Management’s Chief Investment Officer Sankaran Naren is steering his bets toward large-cap stocks. This is as per a Bloomberg report. While the Indian economy remains strong, he believes the challenge lies in valuations rather than macroeconomic fundamentals.
Speaking to Bloomberg News, Naren, who manages assets worth over $100 billion, pointed out that while India’s stock market is not as overheated as it was six months ago, it is also not at a stage where investors should aggressively buy. “India does not have a macro problem, it has a valuation problem,” he told Bloomberg.
Large caps over small caps
So far this year, Nifty 50 Index has remained largely stable, while the Nifty Smallcap 250 Index has plunged 14%.
This divergence has led Naren to increase exposure to large-cap stocks, which he sees as a relatively safer bet amid uncertain global factors like US tariffs, climate change, AI advancements, and geopolitical tensions.
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Apart from equities, Naren favours commercial real estate and performing credit over sovereign bonds, added the Bloomberg report. He also cautions investors against taking excessive risks by going all-in on equities, advocating for a more balanced approach.
Stock market: Less irrational, but not a bargain
While Indian equities were in a frenzy six months ago, the situation has now cooled down.
Indian stocks are less “irrational” than six months ago, but at the same time they are “not mouthwatering to buy,”’ he told Bloomberg.
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