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Nilesh Shah says India’s long-term growth story remains good and valuations are reasonable


Market veteran Nilesh Shah said in an interview with CNBC-TV18 that he believes India’s long-term growth is “still very good”. He also said valuations in the market appeared to be fairly priced in the current market environment. His remarks come at a time when the major indices have halted their almost one-sided 18-month rally.

“Right now the assessments are fair. It’s neither expensive as they were in early 2008, nor cheap as they were in March 2020. They are reasonably priced. If there is a correction in the market due to various events, increase the equity allocation. If there is a rally in the market, book profits, ”he said.

Shah, group chairman and managing director of Kotak Mahindra Asset Management Co, believes that now it is time to bet on companies that have access to deep funds.

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“You have to bet on a person or a company that has access to large pockets of capital. If your capital isn’t infinite, you certainly won’t be a winner, ”Shah said.

The seasoned fund manager advises investors to go through the asset allocation process now and make income minus savings equals expenses.

Inflation is under control in India, Shah said.

Retail price inflation accelerated to 4.48 percent in October compared to 4.35 percent in previous months due to rising food prices.

The RBI is expected to reveal the outcome of its scheduled policy review on Wednesday. A majority of people polled in a CNBC-TV18 poll expect the central bank to raise its FY22 consumer inflation forecast from 5.3 percent to 5.4-5.6 percent.

The Street remains divided on whether the RBI will increase the reverse repo rate – the interest rate at which it borrows funds from commercial lenders – to see the impact of the new COVID variant, Omicron.

Seven in ten economists polled by CNBC-TV18 believe that the uncertainty surrounding Omicron’s impact could reinforce the RBI’s “wait and watch” approach.

(Edited by : Sandeep singh)

First publication: STI


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