Good perspective, thanks. While I agree with you that the world of zero/low interest is not returning in a hurry, unlike in the US, I don’t think it will change equity returns in India so much. We seem to be at a stage when the flows to markets from domestic investors (retail and institutional) will only increase over the next decade, even if the pace of increase slows. Given that, equity returns should still continue to be strong even in a relatively high interest rate scenario. Of course, there will be ups and downs.
To me, it seems that the real risks for equity returns in India are geopolitical shocks (say, a war with China) and economic mismanagement leading to both economic and social problems (increasingly, a possibility).
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