Market Euphoria Is Over Best Time To Buy Stocks After Covid S Naren

TITLE: Market euphoria is over. Best time to buy stocks after COVID | S. Naren Explains | The BroadView CHANNEL: The BroadView DATE: 2026-04-21 ---TRANSCRIPT--- Therein we are in that time when there is fear, there is excitement, there is greed and there is also an opportunity.

I think it’s a very difficult time. Global geopolitical environment is extremely disturbing. Identify the cycles equities in this entire map which is in front of both of us. Where should I put this equity? I would say FI seem to be in despondence at this point of time. The second puck is the most controversial puck small cap and midcap. They were in a state of euphoria at the beginning of the year. Your proprietary indicator which is the indicator which the AMC uses for benchmarking purposes for the first time it’s flashing green after code. The indicator is saying that today the market is not that expense. Normally the residual asset class is gold but this time the residual asset class just took off. Let’s look at growth 2030. No, absolutely. I don’t want to have any of such a reputation. So if I have to put this block here which is risk which could topple everything. What is your definition of a good fund man? Great fortunes are not built in noise. They are built in the silence of conviction. My guest on the show today has never claimed that he can predict a market top or a market bottom. But he surely understands the alchemy of market cycles, fear, greed, depression and more importantly euphoria. S Narin in last three decades has fulfilled the most important duty of a fund manager which is to generate compounding return for investors by keeping risk as the centerpiece and as managed money with lot of integrity. Today we’ll not only talk about market cycles, we will build them. We’ll talk about where India is headed in 2030 and more importantly in this time when everybody is worried some are excited where is opportunity for a long-term investor. Narin nothing’s changed for you but a lot has changed for me. So thank you for joining us. The pleasure to talk to you Nikon after quite some time. We are in that time when there is fear, there is excitement, there is greed and there is also an opportunity. Paint the big picture for us. I think it’s a very difficult time in the sense that uh you know the global geopolitical environment is extremely disturbing. So every day we have to watch the global geopolitical development. Over the last decade the Indian macro has been kept very very well. So we just used to not worry about macro only focus on valuation when it was cheap be very positive it was costly we worried about valuation. So we have one of the most difficult periods because see if you are a country and you know that the events are not designed by you and lot of things happen around you on which you don’t have a control it is a tough time and as fund managers of other people’s money it’s not an easy period. So you know we we have to be we always watch developments 24 by7 not knowing what will happen in the next 6 hours and that has been the period now for almost 45 days now you have a repetition some call you Mr. contrarian some say you only smile when there is bad news some say that you only laugh when there is a panic in the market that’s not a great reputation to have that no absolutely I don’t want to have any of such reputation see at the end of the day we manage other people’s money and what we have seen over periods of time is that when everything is good people forget the word called risk and then they say we have to make money at any lost like parts of 2024, parts of 2007, etc. And there are times like 2020 when people forget that there’s an opportunity ahead of us. So the challenge, you know, when you’re managing other people’s money at ICSI is to see how can we try to make it better for the investor and that is the only way in which uh the investors will trust the mutual fund industry and us and that is how we’ve looked at it over a period of time. So there is no question of being happy if markets fall. Never. Uh at the same time there is no question of being very happy if the market is crazy and uh you know that people are doing the wrong things by buying at a point of time. Lo can I say that in last two years the macro was good but the micro was decent. Now the macro is challenging but the micro is getting better. Clearly the micro see go back and look at 2009 if people had looked in March to May 2009 and asked how’s the micro it would have looked very bad go and look at what happened after 1 month when the world was closed in co and asked how is the micro it would have been bad micro mean reversion is much easier to believe in you know that bad things don’t last forever so so actually what happens is it’s not that the micro is going to be very good for the next 3 to 6 months. It is a question that you know that the next 3 to 6 months lot of companies are going to face increased cost. They’re going to have problems in their supply chain etc. But if you go back 2 years later, if you go forward 2 years later, you know the environment is going to be much better than where we are today. So micro is always easier to predict than macro. And that is why when micro is uh is in favor, it’s easier to buy than when macro is in favor. If macro is in favor and micro is not in favor, which means valuations are high. You just don’t know what to do. You’ve never claimed that you can call a market top. You never claim that you can call a market bottom. But you’ve always insisted that the biggest trism in the market is that markets are cyclical. Greed, fear, excitement, they’re always part of the cycle. You’re a top- down investor. just to break it for a viewers that you look at the big picture and then you start allocating capital and how beautifully ICIC potential AMC has really you know managed or compounded wealth for investors over the years I think is quite extraordinary but my question to you Narin now is that let’s identify the cycles equities in this entire map which is in front of both of us where should I put this equity puck actually if you look at it there are two types of investors in India Yeah, one I call FIS and second I called Indian investors, Indian institutional investors. I would say FIS seem to be in despondency at this point of time and uh I mean they have not seen returns for the last two years. Uh in dollar terms they have actually not made money. So they are really despondent about India. As far as uh in domestic institutional investors are concerned, they are in anxiety. But whether that anxiety will go back to thrill or whether it’ll go to fear, they themselves don’t know. But they are right now in a feeling of anxiety. But at the same time, they strongly believe in the India story. They strongly believe that India is a good long-term investment opportunity, which is the reason why mutual fund inflows have been so good. So while they have anxiety they’re not worried about India long term. So they are more looking to move to the thrill camp than to the fear camp at this point. But fundamentally speaking purely based on the cycle growth and valuations where do you think in next 3 years which is a reasonable time frame for any asset class the puck for equity will move will it move from anxiety to thrill or will it move from anxiety to fear? I’m of the view that I don’t know how to put it in a cycle format. We’ve been telling people we are in a moderate return world. The reason is that the global geopolitical situation is just so uncertain. Uh valuations if you look at a valuation which doesn’t incorporate earnings like market cap to GDP of the world close to record. So to expect big returns like what happened between 2020 and 23 is unlikely at this point of time. So you are in a moderate return world. Can the if the dispondency of the FI goes to relief and they start putting in money the returns would be much higher and if at that point of time the anxiety of the domestic investor converts to thrill then the returns are going to be very high. On the other hand if uh you have a situation where the despondency of the FI continues because of global developments then you’re going to have moderate returns only. So when you say you are you think that return expectations from equity as an asset class should be moderate the long-term equity return is nominal GDP plus 2%. That is the historical return for equities. So next 3 years according to you equity as an asset class will the returns be in line with the long-term averages. So it could even be nominal GDP rather than nominal GDP plus 2%. uh because there can be some derating of the market because of the current situation which is there geopolitically. If you go back and look where we are in 2026 where where we are in 2020 there has been a significant increase in market cap to GDP. So I’m saying can there be a small decrease in that can be it’s quite possible. So that is where we are at this point of time. your proprietary indicator which is the indicator which the AMC uses for benchmarking purposes for the first time it’s flashing green after co after a gap of almost 4 years when the panic struck the world in 2020 uh valuations this benchmark or this indicator was green if you believe that macro risks are there earnings growth is going to be moderate then why is this indicator flashing green the indicator is saying that today the market is not that expensive. So if you we use indicators like price to earnings, price to book, market cap to GDP and government security based on that. But it doesn’t put a geopolitical environment of the world into picture. It doesn’t look at where is the cycle in other parts of the world. The cycle in other parts of the world are also advanced. So I would say that’s the reason we believe in a more moderate return. And you know we have to try to telling investors you’re not going to make money like 2020 to23 is very depressing because people want to make again investing into this environment they want to see 25% peranom it’s very tough that’s it’s tough for us to say this but the reality is we are in a slightly different environment profits have been very good in the last 5 years the entire macro environment has been very good in the last 5 years so for from here to make mega returns by investing even into this correction doesn’t look uh logical at this point of time. Okay. The second puck is the most controversial puck. Small cap and midcap. They were in a state of euphoria at the beginning of the year. Where are they now? They are not in euphoria. Clearly small cap is not in euphoria. I mean actually if you look at small cap from the point of view of FI they were in despair and if you look at locals they are they are in anxiety they are not in a phase of that what why this happened I will tell you is because the domestic corporates and domestic promoters they issued huge amount of paper they could see the euphoria in 2024 and said let’s let’s do as many IPOs as possible So while we all got money, the money got invested in so many IPOs that the the entire euphoria disappeared because of new fund uh the amount of money collected in the capital markets and many of the private equity who had invested in the 2018 to 20 phase they got an opportunity to exit all their holdings to uh mutual funds and other investors. So what happened was that while the money came the amount of uh new money which was raised ensured that the market didn’t go up. Midcap is slightly different because what happened in midcap is so many companies can’t get created. It’s a limited set of 150 companies and in that 150 companies FIS are not big sellers. So consequently midcaps have not corrected and they continue to be expensive. So that’s the situation. Is there a trigger for them to come down? I think if SIPs continue in that area, I think it’s tough for the midcaps to come down. Having said that, are they cheap in in our framework? Answer is no. Okay. Debt, you’ve been making a case that uh nobody is talking about debt. So where will the debt puck go in this cycle? debt on the domestic side is I would say that they are in despondency or despair because today if you try to tell people even after 2 years of no returns in equity invest in debt they look at you whether I’m talking about an asset class in some other uh uh planet and that’s how they look at it and uh so you know the domestic investor is in complete despair somehow in the last five years gold gave very good returns. Global investing gave very good returns. Domestic equity investing gave very good returns. Silver gave very good returns. So they are in a state of despair on debt. So it is from a and and as you know the way Indian debt market is the foreigners are not uh given an opportunity to participate in such a big way. So it’s in a from a cycle perspective it’s extremely attractive. Normally the residual asset class is gold but this time the residual asset class just took off. So the residual asset class has become debt. So that’s why debt has become an very interesting asset class. So to tell people to consider debt or fix a deposit or anything like that is not at all easy. Can I say silver and gold or gold and silver or precious metals they are still in euphoric stage. Yes certainly January was euphoria. uh even now it is euphoric but you know you have to remember that particularly put it in center then I we have long argued that silver for example is a small cap stock the entire float of silver is so small that it is not an asset class gold is an asset class so gold gold gold is I would say an asset class which is an anti asset class there is so many people who worry about dollar consequently they go and invest in gold to arg argue that one should be in euphoria and gold I would say more anxiety in gold I would say silver is more in euphoria and gold is an anxiety because gold plays a role in a in a world where people don’t trust each other in geopolitics I think gold is one of the best asset classes and therefore it it argues for some allocation not zero in silver is zero the silver is zero because silver can’t play a role or you can’t keep tons of silver and say I’m going to manage silver. It’s just impossible. These are blank Tell me where there is lot of despair. Which asset class is in despair right now? Clearly I said debt is in despair. Very clearly debt is in despair because no one is it’s tough to convince people to invest in debt. That is I would say the only asset class where I think to convince people to invest is tough. What is in euphoria in the world? In euphoria there are many I would say silver was in euphoria clearly in January. I would still say that US tech investing is in euphoria but uh you know it never seems to end. We have called for it one year back but nothing has happened. It’s become costlier. So people know that those stocks one was 3 trillion. and it’s become 5 trillion. So $5 trillion market cap companies get created today. There are going to be two IPOs of some artificial intelligence companies and there is going to be an art a company I think which is going to put people in space which is going to get listed. So those kind of companies look to be euphoric to me at this point of time but you know there while we can talk of euphoria it has not worked. So have we been wrong? The answer is yes. We have been wrong so far. IPOs where do they come in? Are they still are we in this euphoric stage of the market? I think eu the euphoric stage of the market is over there. Even in IPOs in IPOs also it is over. Today if you had to look at an IPO I would say the kind of uh difficulty that most of the companies have had in the last 1 month or two months to get an IPO done is not easy. The number of IPOs have just fallen off. The number of block blocks have fallen off. I don’t think we are in that phase of 2024 where a lossmaking company could very easily raise money by doing an IPO or a QIP. Today it is very very tough. I think that phase but can it come back? Yes. So I would say it’s a very interesting situation. You are possibly even in fear in IPO but from fear can we go back to excitement and thrill in your sheet. It’s something that can’t be ruled out because the domestic investor believes in equity as an asset class very strongly. So if they continue to believe in that asset class very strongly, there is no reason why we can’t again have a buoyant IPO market in the next 3 6 months. You always identified these cycles for us and thank you for identifying these cycles over the years on different forums. I want to understand that what is the science and the maths behind it? I mean is there indicator which you look at which tells you that peak bottom despair euphoria is there a mathematical number or this is just gut call what you know there are different gurus yeah you Warren Buffett says look at how others are investing so in 2024 we could see people launching IPOs and those IPOs people they got subscribed so easily without enough of you know analysis at that point of time so that’s an indicator then you look at how much money is coming into an asset class. The amount of money which is zooming into an asset class. Take for example January inflows into gold and silver ETF. It was such a sitter to know that we are at a peak. I mean never before has gold and silver got inflow equal to equity as an asset class but it got it in January. So I would say flows are a very very important part of what you identify top and bottom. Clearly if you look at March the reason for the green clearly happened because FI sold equity that month in such a big way. So if you just look at the flow parameter of March 2026 it will show as one of the biggest selloff by FIS ever. So that is the reason why the indicator came to green. Although it’s not connected to flows but the reason on March 30th it came to green is only because of savage fi upload. I would say flows play a very big role. Valuation plays a role and how people around you think about it uh clearly is a very very good indicator of where you are. Like you know when you do a investor event if every day morning, afternoon, evening if people ask you what should I should I not invest in silver that is an indicator that something is and if you have to talk about asset classes which are important like you know we’ve seen periods like 2008 December where people were just not willing to think of equity. Those are all superb times to consider that asset class. Can I say that while everybody is claiming that AI is going to be changing the way how we would be working, AI actually will never be able to capture the emotion of fear and greed because ultimately AI models are based on past data and past data cannot tell you what is happening in the future. So for an average Joe who thinks that okay AI is going to change the investing world. The the grain of the truth here is that AI is important. It is crucial but it cannot uh beat a fund manager. can’t say that if you look at the success of renaissance funds for example or today there is some category of funds called CTA funds which have become bigger and bigger and bigger in the western world for example they don’t think they don’t use conventional valuation techniques they play they play at some different type of way of investing but they have been successful now why they have been successful I we do not know so which shows that you can never rule out how things will move. But I we can say based on understanding that if individuals are the decision maker uh behavioral finance works but if individuals subjugated to machines whether they will suffer from the same greed and fear problem. We do not know we will know over the next decade whether they machines have the same greed and fear problem or they don’t. Well then you always said that investing is about understanding the past but also understanding what will change. Investing is about being on the right side of the change and in markets we need to focus on not where the puck has moved but where the puck will move. So let’s look at India 2030 that’s where the puck is going to move. We are in 2026 4 years uh the number most the biggest criteria for any investor is identify growth. So I’m going to put this block here and let’s look at growth 2030 next 3 to four years. Are we in for a lean growth patch? Are we in for a moderate growth patch? Actually this is the debate that we at ICA keep having. The biggest challenge is it depends on how AI will affect India. Now is AI going to lead to a situation where Indian IT services continues to grow? Indian GCC’s continue to grow or does it lead to a situation where these industries are going to have challenges that is going to be very very important as we speak we are big believers that over a period of time that uh Indian IT services will have to re-engineer themselves to grow but they’ll continue to grow once they re-engineer themselves and GCC’s will not get that badly affected because India is a very competitive destination in services but if there were to be concerns on them and it’s not that as as you know as the facts change we have to change our view with the current view we believe that Indian IT services will have to re-engineer and GCCs will at least not degrow then things are okay but if something were to go wrong there then I think we have a challenge because otherwise if you look at it India has very good macro India has working age population which is growing I mean from all those points of view I would say growth should we have domestic savings we don’t have a current account deficit the domestic savings can take care of basic growth we’re not so last two years or two years we have hardly got any FDI despite that the growth has been decent so we don’t worry about it I think this is the only factor and it’s not a factor we know we are trying to think about it but we don’t have certainty there are three big changes happening one is AI second is energy transition and the third is the consumer. Let’s understand the impact of AI. Everybody feels that it will lead to productivity gain. We will have more you know time on our hand. We would be spending out a bit more. What to your mind could be the net impact of AI? Will the AI uh you know will the companies who create us will the creators benefit? Will the adapters benefit or will the consumer benefit? History says that almost everyone benefits. So you take the mobile revolution. Do you think it’s only the person who made mobile phones who benefited? All of us gained. Take the computer revolution. Do you think it is only the people who made computers who benefited? Everyone gained. So if you go by the past uh technologies, everyone has gained. There is a point of time you know when if you like look at the past boom, it was only the PC manufacturer who benefited. It was only later we discovered that the PC manufacturer can help us. So if you look at the entire internet boom, who would have thought we’ll create such a beautiful payment mechanism like UPI, it happened because of internet systems. So I would say that at this point of time we are finding it difficult to see how it will move forward and I wish we had foresight but we don’t have that level of foresight. What we do is we keep thinking openly and be willing to change our views. But I think many companies will also have to change based on evolving things and many individuals also have to continuously keep learning to update themselves on changes in technology and that is a challenge ahead of us. The second block for any investor is earnings. for next three to four years at aggregate level. How do you see the earnings trajectory moving? Is the worst of the contraction what we saw 12 months ago, 18 months ago where the earning estimates were downgraded, base effect had kicked in, consumer had slowed down. Is that patch is that lean patch behind us? See this 2020 to 23 year kind of period where earnings grew substantially that phase won’t come to the same extent simply because at that point of time at the starting point you know there were areas like financial services where profits were very low. So that those profits grew up grew significantly in that period. So we are believers that maybe the earnings slowdown goes away and earnings improves and you know clearly there will be possibly better earnings 2027 28 over 2627 should be good because 2627 will have all the problems of the after effect of what’s going on at this point of time. So we are believers that 2728 should be much better than 26 27 and that can help the earnings as such. But to expect that earnings will drastically change like 2020 to 23 period we’re not believers. That’s the reason we are much believers in a more moderate return environment and that is the main reason because we don’t think that earnings in many companies can just shoot up because the base is much better. uh we have on profit corporate profit to GDP ratio. We have looked at the corporate profit to GDP ratio from 2010 to 2020 it almost came down from 2020 to 24 it has just shot up. So from here no it for it to drastically move ahead of GDP is very difficult. So Narin now earning has couple of components. One you see a cyclical recovery in some beaten down sectors. you see a big new growth sector getting added or you see massive capex by the existing companies which lead to a new level of dimension. So divide the earnings picture for us. Are we in for a cyclical recovery from beaten down sectors or are we in for new growth sectors getting added to the kitty? I think the new growth sectors will get added much later like the PC world or even the mobile phone period or even internet. Initially the profits come in US and the profits are first seen in US companies. Then after that when it the technology gets exported to the rest of the world and the rest of to the world adapts that that time the earnings come in the rest of the world. So somehow our view is that maybe post after the first 2 three years earnings growth could come in many of these new areas in India but initially most of the growth is going to first come in the US tech companies which is what the earnings the market caps of those companies are also showing up. As far as cyclical recovery is concerned yeah cyclical recovery is as I said will not be of the stage of 2020 to

23. some amount of cyclical recovery is possible but not large because there are no not too many sectors which are actually going through a big earnings problem at this point of time. So that is why for all the sectors to see big earnings growth we are not big believers but then um you know this more than you know it better than anyone else that the composition of earning at a macro level keeps on changing. There was a time when Indian basket was largely a commodity and a textile basket. Then soon it became the TMT basket. Then comes financials which account for heart of the market right now. So where do you think the large heart of the earnings pool will still lie? I think India is a leader in services. India therefore will see everything to do with services will be the area where earnings will be there. So that will include financial services, it could include IT services, it could look at other services. Then whichever are the areas based on these service sectors where there is lot of consumption I think those earnings clearly if you see sectors like pharma fmcg all of them have to grow retailing for example is sitting on very low profits those are all areas where profits can grow at this point of time but at this point of time I would say it’s tough to predict which are going to but India is still a servicesdriven economy but if we take a five-year view it’s possible manufacturing may take off

because it is quite possible that India will use this current environment to set up manufacturing bases because people people trust India more than most other countries. So they may actually focus on manufacturing from India rather than trust many other countries. You’ve never been a big voter of uh chasing what are called as uh the narrative stocks. You know lot of narrative stocks are there in the market EV solar exciting things which are happening in some of the new tech companies which is one earnings narrative in the market do you think where markets are completely mispricing earnings growth and we are in for a root shock I don’t know there was a time when we used to be very these electronic manufacturing companies used to trade at 200p but if you see the last one and a half years some of them have corrected So I think some of these contract manufacturing areas if you ask me have been areas where we have been careful and you know because we don’t know whether those companies are just going to be supporting manufacturers whether those supporting manufacturer companies deserve that such high valuations has been a source of we not something we have not believed in them. There is a lot of excitement about defense and looking at the geopolitical crisis, the fact that self-dependability on defense seems to be increasing. While the macro theme is strong, this is a four-year-old theme. Stocks are not cheap even though they are B2G businesses. They’re trading at valuations of consumer. Do you see we could be in for a nasty surprise in defense? Unlikely given the geopolitical environment. I would say that it’s very tough for any country to say we will not invest in defense. Uh given the valuation oriented contrarian mindset within our company, I have found it difficult but some of my colleagues have found it easier to look at some of the defense stocks because the valuations are much higher than what they used to be. But it in this environment, how would you economize on defense? Defense is something very basic if you ask me as a country. You can’t afford to say I won’t spend on defense. So Roti Kapra telephone or defense I can say that for everybody now in 12 years ago you indicated the same to me on a different forum which is that everybody thinks that uh India will have only roads and nobody will buy cars. 10 years ago you told me that everybody is thinking that Indians will only buy cars and there will be no roads. So I think no we need to create big export industries to take care of our imports of various things. So I would say if we had to take one theme I would say that we have to bet on exports as a theme which is down 34% already which is down and I we believe that as you know as we need to keep importing oil and various other things we need to focus on exports as a team whether it is manufacturing and services because and I think we have the manpower for it we have the capability for it and it is going to take time to build but I would say if I we had to choose one theme it would be exports. I’ll put in the biggest bug bear. We’ve not complained about inflation a lot actually in last 10 years. This used to be like this hot topic for every macro investor that inflation they inflation by and large barring 2022 has been under control. Next 3 to 5 years will this ghost of inflation haunt us back because geopolitical crisis, supply dynamics, oil straight off her disruptions are happening. Are we in for a shock on inflation? I think the Reserve Bank and the government played a very big role in bringing down inflation. That is the reason that India is one of the few countries in the world where in the last 10 years uh the government securities yield has gone down unlike most of the countries in the world. So as long as the government and the Reserve Bank continue to focus on keeping inflation under control, we are not going to have an inflation problem. This did not happen just like that. It was due to continuous work by the Reserve Bank and the central government in trying to keep inflation under check. That is something it is not something which happened just like that. If you look at the last 10 years, show me a country whose uh government securities yield is lower than what it is. I think baring I mean Japan is much higher. US is much higher even Germany kind of countries is much higher. So I would say it is a good and that effort has to continue it. It is an continuous effort otherwise inflation will show up. I’m saving the most important one for the last which is flows and again we’ll have to spend some time trying to understand flows. I’ll start with SIPS. Uh the real success story for India, Indians are genuinely now looking at creating wealth by the SIP route. But Narin while the SIP number has gone from 5,000 to 25,000 cr. Are we reaching that higher water mark where it will settle in and around 25 26,000 cr for a long time? Such numbers we can’t predict but I can tell you that uh we habit it’s a habit and it’s a it’s a positive habit. So the only thing we keep telling people is don’t go and say I’m when gold or silver does well start a sip in gold and silver. See the best asset class to start gold as any any s is an asset class which becomes volatile and is not trading at the most expensive price like today equity. So I would say this is the best time to start SIP whether we succeed or not. This is possibly the best time to start SIP. What is required for SIP to make money? You need volatility. you need uh not a very high valuation and you should have confidence that in a 5 to 10 year period the markets will go up. So that is a situation at this point of time today. So this is the best time to start SIP. So I’m a believer that SIP should go up from here and I hope people don’t start SIP in the asset class which has done too well. But then for the first time the real temperament of a SIP investor has got tested. We had a brief lull in 2022 in and around the Russia Ukraine war but that lasted for a couple of I won’t say months couple of days. This time the pain has been rather prolonged. First last year no returns and now absolute drop. When you speak to your distributors when you speak to individual investors are you getting a sense of nervousness or the SIP story is intact and formidable? There is no anxiety. There is no anxiety. There is still optimism on SIP. If I look at your uh chart, there is no anxiety and there doesn’t seem to be any worry on that. People are optimistic on SIF. Many of them are looking and thinking should I add to the sips sips? That is what they are all thinking at this point of time. And that’s like a you know it’s it’s like a moment that you want to say okay I’m so happy this SIP culture has worked out because your comments at this juncture they really matter. Just when you know we start getting this uneasy feeling at the bottom of a pit that tala return za return z you feel there is enough and more awareness which is there that the sip culture in India is not only intact it is only going to go bigger and yeah that’s what it looks to me at this point of time right now I would say still optimism actually let’s see let’s hope we are right we’ve been used to getting fi flows on a daily basis last 24 months we’ve been used to ing FI outflows on a daily basis. Indian dollar terms in last 5 years has given absolutely no returns and just like you’re thinking that it’s time to buy fear I’m sure from an foreign investor perspective earnings recovery are decent valuations are not that stretched we really are on the right side of lot of reforms which have happened are we in for a surprise that suddenly one moment just like money went to China 6 8 months maybe 12 months rose would come back to India that’s what I mentioned at some point of time this despondency should get converted to relief it will That relief is that cycle move to relief when it’ll move I wish I could tell you but at some point of time it’ll move to relief because India is a non AI based growth story and therefore you know at some point of time people will think have I overinvested in only AI stories so when that happens this despond despondency will move to relief the question is people are asking when that answer we don’t have and the war certainly played a role role in again creating uh confusion. So but I would say at any point of time this despondency can go to relief but when we don’t know I’m keeping the last block and that can over arch everything what we’ve discussed right now there are geopolitical crisis we don’t know there are crisis which we don’t know but there are some known risk also so if I have to put this block here which is risk which could topple everything what to your mind is a risk which is a known risk and markets ignoring It’s not a known risk. I think right now if you ask me the market over the last 3 months see we’ve gone through a fair amount of risk. When have you seen oil go up 40%. So I would say the market has not market has seen one of the largest rallies in oil ever and oil is our principal input. So I would say that the risk of such an event has actually played out in the month of March. So we had a fair amount of position fall in the market due to that. So the only thing is do we understand what will artificial intelligence do that part I would say is something which we worry about because I think it’s a risk which exists in our mind because we don’t know enough what is going to be the every day somebody comes up saying one new model is coming up this new model will do all these things. So do we know enough? The answer is no. Aside from geopolitics, I would say that the impact of artificial intelligence on various things is not very clear to us and that’s a bit worrying. Howard Mark speaks about look at the second derivative impact of any new thing which is mobile phone led to creation of Uber economy, GPS led to the decay of the map industry, internet created e-commerce. What to your mind could be the second derivative impact or opportunity of AI in India and world in general? See when COVID happened people realized a lot of the work could be done offshore what was not being done offshore like that after AI could it happen that more work can be done offshore than even what was done preai I don’t know that is the wishful thinking that uh we wish we should have in this country who would have believed precoid that we can do uh so many things uh away from the place of work it was just not possible So I would say that is the biggest positive that maybe a lot of things can be done out of India because as a society we have lot of capabilities. So maybe certain things we can now do which we could not do earlier. Um purely as an investor I’m committed to invest in equities. I’m personally a long-term believer in the India story. But when it comes to choosing a mutual fund or a fund manager, the options are plethora. What is your definition of a good fund manager? See, it’s a it’s a tough question to answer. But I would say that you know you have to see people people invest on the basis of one year return and people look at return at the top of the market. I would say know I used to tell people I have done this in an event in Chennai a few about 18 months back. I said don’t ask don’t look at any Chinese fund manager at that point of time. I said the maybe the best performing Chinese fund manager may be at bottom. So I tell people don’t look at a performance of a fund manager at an extreme bottom and an extreme top. Second look at it over a longer period of time. And that is the two things which I tell people. So the process of measurement cannot happen when the markets are irrational. That is that is the most important. You have to believe that the markets are rational. Now when do you think the markets are rational when times like today are rational in the sense that returns have been average. But if return is very negative that is not the time to measure people. Um when I started learning investing we all were introduced to Benjamin Graham intelligent investor. I’ve read it once but I’m sure you must have read it couple of times. Then we started reading about Buffett who changed in you know Benjamin Graham’s philosophy of cigar but investing. Then came renaissance. Investing has changed, style has changed. What to your mind could change in the world of investing in next 5 years? Could it be tech? Could it be something different like P investing has changed? Big money has been made by buying companies which are lossmaking. Who would have thought that cash flows would be ignored. What to your mind could change in next 5 years? It is a lot has changed. Even today we are grappling on what to do with all the companies which are lossmaking and which say that they are all platform companies and they are going to make money in the next 5 years. Forget what is changed. I think the last 3 to 5 years with all these new age companies coming to India has already put us into enough change and we are yet grappling with it. See we could we could move out of the Benjamin Graham model to the Charlie Monger model of looking at quality. Now we have to look at the model of looking into models like platform companies and make successful investing. I think that phase is still we are still in that process of learning. Forget the next change. The next change will be AIdriven that is clear but that stage is first this stage we’ll complete then we’ll go to the next change. Last but one question we all love to talk about change right? I mean we all ponder over it that let’s look at what that new thing is going to happen. But Basos said something very interesting. He said that while we obsess with focusing on what will change. I like to identify what will not change. Let’s talk about what will not change in investing. People will focus on performance. They will not focus on risk all the time. At the top of the market, they’ll just focus on performance. At the bottom of the market, they may just focus on risk. This doesn’t look like changing at this point of time. Everyone knows they have to do asset allocation. But in January 2026 at the peak of gold and silver they invested so much of money in gold and silver. So what won’t change is at this point of time if individuals are decision makers tough for them to handle the greed and fear even today after knowing that they have to be greedy at the bottom and fearful at the top they end up doing the reverse. Narin you’re managing over 10 lakh cr while we’ve spoken about buffet montier we’ve spoken about Harvard marks we put in basos we spoke about manger but I want to understand your model if a model has to be made on s narin’s model what is your model what is where are you thinking differently because I’m very confident of this narin that the coming generation will be reading about the good work what you’ve done individually and what this institution has done. So what is your model? I want to understand that. I think you know the power of ICA was that we could collect money and then we had to create a model into scalable things. We can launch one small sector fund and try to make that the very critical deliver huge returns in a yard but it won’t be scalable. The beauty of ICIS is the ability to actually create scale and then manage scale. Because if your goal is to manage a small amount of money, that is not the goal of ICA. The goal of ICA is to create impact on society. That is what they have done from 1955. And I would say that is what is the goal of ICSI to be able to manage scale in a manner which is reasonable because if you’re managing very small sum of money certain things are easy but we have to do it at huge scale and therefore there are difficulties out of it to manage money at scale in a nice manner in a great manner in a nice manner that is the goal of ICSA and that is the goal for which everyone in our company works for Then you’ve done something today which nobody does. A very honest indication to everybody that how they should be focusing on financial planning. While a lot has changed and a lot has changed for me personally, but for you I can say I’ve known you for over 25 years now. Nothing has changed. You always keep risk and integrity at the center. Your idea of understanding the cycles and really the way you communicate to your investors is quite incredible. It’s an honor to know that I’ve known you for so many years and thank you for really ensuring that of Indians are really living their dreams when it comes to a secure financial future. Thank you. From my side, it was very it has been a great time knowing you for 25 years. Thank you very much.