Rajeev Thakkar Explains Why Fiis Are Really Leaving India

TITLE: Rajeev Thakkar explains why FIIs are really leaving India | 1 Finance Magazine CHANNEL: 1 Finance DATE: 2026-05-12 ---TRANSCRIPT--- Cash levels are still at 19% as of the latest March disclosures. Don’t you see that there are opportunities despite a 10% fall in Nifty50 and Nifty 500? There’s no pure play AI company that we have in India today. The market is perceiving it as extremely negative for the country as a whole. Why is that so?

Why are we so obsessed that we don’t have a Indian AI? A lot of developed countries don’t have their own frontier model. Why are you still banking on these kind of IT companies? I don’t think that core IT function will go away. Why do you see that foreign investors are going out valuations that run up ahead of the fundamentals? Speaking of reads and in bits, what are your views on these asset classes? I think retail should definitely stay away from they are better suited for what should people do in these turbulent times? Should they be disturbed or should they stay the course? Sleep well. Today we are with Mr. Rajiv Takar who is one of the most celebrated figures in the fund management industry. He’s the CIO behind Parak Parik Plexiap fund which has close to 1 lak 30,000 crores in AUM making it the largest by size for a flexiap fund in the industry. A charted accountant, a cost accountant and a CFA charter holder, Rajie is one of India’s most prominent voices in value investing. Known for his patience, his discipline and his refusal to chase the market. In this episode of speaking with stalwarts, we ask him why PPFC is still holding nearly 20% in cash. Why Indian IT isn’t dying despite the AI panic. The real reason FIS are pulling out of India and the realistic return number every Indian investor should set for the next 10 years. Hi Rajie, welcome to our show speaking with stalberts. It’s a pleasure having you here. Looking forward to this conversation. Thank you for the opportunity. Thank you. So uh to begin with the very first question that the internet wants to know. While you did deploy more than 4,000 crores in March, but uh still don’t you see that there are opportunities despite a 10% fall in Nifty50 and Nifty 500 because they’ve fallen like around 10% and your cash levels are still at 19% as of the latest March disclosures. So cash percentage keeps moving up and down based on stock price movements. So let us say we have 20 as cash and 80 is in stock. Let us say the market moves up 10% 80 will become 88. Cash will optically look as if it has come down. If stock goes down from 80 to 70 to 10% fall that you referred to, it will look as if cash has gone up. So despite our deploying it looked as if cash came down only marginally. So that keeps bouncing around. Netn net what one has to look at is in the last 18 months Nifty 500 which is our benchmark or Nifty50 which is the widely tracked index has gone nowhere right in this period if anyone had money in debt instruments those debt instruments would have paid 7% per year roughly give or take for 12 months over 18 months it would have given let us say 10%. Right? So by being in cash we have not lost out. Our investors have not lost out. We are not averse to deploying when uh opportunities come by. At the same time just because we have cash we’ll not forcefully deploy. We have done transactions. So we did a single transaction for 2300 crores where we deployed in something that was of interest to us. the transaction was disclosed on the exchanges. Uh we have done another transaction of 900 crores single ticket. So there are opportunities which come our way and then we are aggressive. Uh the fall was short-lived and uh in India we have rebounded somewhat from the lows that we saw. Uh US markets S&P 500, NASDAQ 100 are close to all-time highs. Uh in India we are a oil dependent country. Uh as we speak oil has again crossed $111. Brent crude has crossed $111. So while a retail petrol diesel prices have not gone up but someone in the system is bearing the brunt either the OMC’s or refiners upstream companies the government somewhere. So one will have to wait for opportunities. Uh it’s difficult to calibrate falls. So people think that every fall is an opportunity. What people don’t realize is that in uh global financial crisis 2008 2009 the fall at the index level was 60%. In COVID the fall was 40%. This time the fall was not that big to start with. That’s the first point. Second is our starting valuations were not cheap. So uh a 10% fall is welcome if you are looking to deploy obviously and one starts looking for opportunities but it is not that things were uh completely down and out or mouthwatering across the board. Understood. Since you’re talking about uh a 60% fall in the global financial crisis and 40% during COVID u there’s a flurry of investors that came in after 2020 uh since you have the data of your investors who are from the class of 2020 versus the class of 2013 or 18. Do you see a difference in behavior in terms of how they stop their SIPs or how they withdraw? Is it more erratic as compared to the mature investors? So this is true across time horizons. So not just now it would have been true 20 years back or 50 years back. People who have not seen a complete cycle are more jittery than people who are somewhat older who have seen one bull market, one bare market. So that’s true. The uh more recent investors some of them have come with the expectation that every year every two years you should see positive returns in your statements which is not being borne out by the market data and you can see uh their behavior uh in terms of the unease that is there. So there are questions like oh this is not even beating a so-called simple bank FD. My counter question is if equities beat FD on every time frame, every 6 months, every 12 months, FD will cease to exist as a product, right? The only reason equity gives higher returns than debt products at least most of the time is because it comes with the inherent risk that for some time it may not give you any return or it may give you somewhat negative returns. Correct? Uh speaking of the telecom sector, you recently took position in a telecom company but you waited for it to turn cash flow positive. Are you seeing some other uh industries where this duopoly kind of setup is emerging and companies are turning cash flow positive? Consolidation happens many times. Many times uh competitive forces increase. So it keeps happening in uh sectors with easy entry and easy exit. We saw that in telecom where earlier there was a BSNL MTNL kind of strangle hold. Then you had two private players coming in the cellular space in every region every circle as it was called. Then licenses were opened up. Too much competition. Then consolidation happened as you referred now two large profitable players and two other one PSU one private company. Uh we have seen that play out in airlines for example. So uh from numerous airlines largely we have one air India where Tatas merged with Tara and Air India and you have Indigo as the uh dominant airline and then you have the small carriers but largely it’s between these two. So it’s happened in the case of airlines otheries remain uh the way they are. So in deposiitories for example we have two players. In mutual fund register and transfer agents there are two players. Uh stock exchanges there are two players. Uh commodity there’s one large dominant player. Uh electricity there’s one large dominant player. So these are some of the businesses which are uh seeing less competition. Understood. Speaking of the IT industry which employs tens of millions of people if we talk about the entire gamut of IT services industry, there’s no pure play AI company that we have in India today and the market is perceiving it as extremely negative for the country as a whole and of course for these companies as well. While u from uh your public conversations what we have learned is that yes there’s going to be a hit but not uh as big as the market is perceiving. Uh why is that so? Where do you see IT companies uh say 5 years from now? What should they do in order to stay relevant and why are you still banking on these kind of IT companies? AI space is pretty narrow even for other countries. So while a lot of people criticize India for not being at the forefront, look at the developed countries. Does UK have any frontier models or any companies with frontier models? Does Japan have any frontier models? Answer is no. South Korea or uh any of the countries which are better developed than us. Uh so France has something in Mistl but again it may not be called a frontier model right? Largely the frontier models are three. uh you have Google with its Gemini models, you have uh OpenAI with its chat GPT and you have Claude Anthropic. Largely these three are dominating. Then there are other various also rans or just behind them. So you have Chinese Deep Seek or you have Llama from Meta and things like that. Even someone like a Microsoft actually they are partnering with others or Apple has now announced partnerships they it’s not their homegrown AI right so why are we so obsessed that we don’t have a Indian uh AI a lot of developed countries don’t have their own uh frontier models it would have been nice if these things had been done in India but they haven’t been coming to the uh question on uh IT services companies. So while there is pressure on pricing and while there is pressure on employment, so the social aspect is a challenge and what to do is a different question. But let us say you had a product or a service and it was told to you that earlier you could sell your product or service at 100 And going forth you will be only be able to sell it at let’s say 90. Stand alone you don’t know whether that is good or bad. Right. Right. So when you were selling it at 100 and if your cost was 80 you were making a profit of 20. Now that you are going to be able to sell it at 90 and if your cost falls to 70, you may still end up making that 20 profit. Better margins as well. Yes. Uh so better worse, we don’t know. But people are looking at only one side of the equation saying there will be deflation in terms of the order values. But that deflation in order value is because of increase in productivity of their staff. So maybe you will not require those many people on a project. Uh timelines could be crunched, right? The turnaround time will be faster. What happens is when pricing of something comes down, there is demand elasticity. So a lot of projects which were not given out because the in costbenefit analysis it was felt that it’s not worth spending so much. A lot of those projects could become viable with understood costs coming down. So maybe you will see uh demand revival in so it may not be visible immediately in terms of growth rate. People obsess over topline growth rate and topline growth rate is not coming and that’s where uh people are obsessing oh the business is over. But at the same time uh their input costs are also going down because they can employ fewer people those people will be able to be more productive and as they are able to offer services at better costs better pricing uh you will see work coming back. So IT services are cyclical in nature. Uh they have had their up cycles and down cycles in the past. So Y2K was a big upcycle. Uh that work came to an end but internet took up a lot of slack. When internet crashed there was some impact on IT services companies and there was this shift from mainframes to client server architecture. Correct. shift towards cloud, shift towards social media, analytics, uh those kind of thing, internet of things, uh SAS, uh all these have uh come and changed the underlying way of doing things. AI is one such thing where it will require some reinvention on the part of our companies, but I don’t think that core IT function will go away. Understood. So maybe the workforce has to align with the changing requirements of the U market and they’ll maybe have to may not maybe but for sure have to upskill themselves and that’s what uh the IT companies need to focus on. Understood. U since we were talking about different economies like the UK, US, France etc. Uh what do you think? Should there be an allocation to global portfolios in an investor’s portfolio? Say if we are talking about a retail investor not someone who can invest through gift city what are should there be global diversification in the retail investor’s portfolios and if yes then what are some methods they can take exposure so firstly gift cities available also for retail investors uh lot of funds are available for $5,000 and going forward they’ll be available for as low as $500 ticket size as well so it is not just for wealthy. It is also available for uh individual investors. A lot of people don’t realize this that India’s market cap is just about 4% of global market cap. 96% of the listed market cap is outside of India. Uh today when there’s a huge telecom revolution in India, so many people have cell phones in their pockets. The operating system are largely two iOS for Apple phones and you have Android phones and both these companies are outside of India American companies. The phones are largely although they are now made in India but the companies which design them, market them are either American or South Korean or Chinese. Hardly any Indian companies are there. The apps that we use uh YouTube, Google, uh WhatsApp, Facebook, Instagram, all of these are again foreign companies. Blockbuster drugs which get innovated uh OMICe, V, Goi, Monaro, all these get innovated outside. So there are a lot of opportunities outside of India and one should not ignore those markets. So I would recommend people to look at this seriously. Increasingly mutual funds in India are not able to offer this global diversification. For 4 years now the limits are frozen. Uh but limits for individuals are open. They always were. Individuals can remmit rupees outside convert to dollars or whatever currency LRs via LRS and invest abroad. Understood. So since we were speaking about gift city as well uh from what I understand is there are still operational challenges for a retail investor sitting in India like there’s a lot of paperwork that they need to do while the video KYC process has been largely streamlined for the NRIs. Do you think there are some challenges that exist in the gift city ecosystem vizavi other international financial centers like the Dubai uh financial center or the Singapore financial center and what improvement should we be making? So surprisingly the uh hurdles for Indian investors are not that many. uh an Indian investor does not need video KYC as long as the Indian investor has the CKYC done uh you can put in your PAN uh other ways OTP and all that and you can get onboarded end to end digitally the friction is in actually remitting the money and this is largely bank-to-bank things uh so each bank will have their own process processes for LRS and if someone is investing more than $10,000 then that tax collection at source uh kicks in the 20% TCS but other than that I don’t think there are frictions now uh things are getting sorted very quickly uh across uh fund houses whoever have launched uh retail schemes the same registers who operate in the mutual fund space are also there so CAMS and Kay Fintech have also set up divisions in Gift City and they are largely replicating the mutual fund processes for retail funds out of Gift City and even uh CCIL has made it uh is working on making things easy for remittance. So this as in when it takes root even the bank friction will largely go away. Understood. Now uh speaking of the foreign investors in the last two years they have taken around more than three lakh crores out of the Indian markets and in March itself uh this year in 2026 they took out more than one lakh crores. Why do you see that foreign investors are going out and what should India as an economy do to bring them back if at all it is important in your view? I think the uh valuations had run up ahead of uh the fundamentals. Beyond that, I don’t think there was a large issue. Uh so we have had MNC subsidiaries listing in India. Now these subsidiaries are maybe 7 to 10% of their global turnover whereas their market caps were as high as uh 80 90% of the global market cap. So there was a huge disparity probably some of these other Asian countries who were very cheap and we had become quite expensive. As and when that gap narrows and closes out, I think we will get our fair share of allocation from FBI. If you are sitting outside of India and you if you are free to go anywhere, you could invest in Japan, you could invest in South Korea, you could invest in Taiwan, China, India, Brazil, wherever. Uh a lot of other markets were looking better in terms of uh valuations and also uh growth rates because some of these countries are in the hardware space. Uh so Taiwan with its TSMC and its fabrication piece, South Korea with its chip makers and with Samsung and all the other companies, they also were on the right side of the road cycle. I think things will selforrect. I don’t think anything specific needs to be done. Understood. What you’re saying is that FIS are largely drawing out of India because of the valuation play. However, the narrative on media and social media is that they’re largely being driven out because there’s no pure AI play uh in India. The valuations of of course uh not cheap. ST is there and there are different other operational complexities that are making them uh go away from the Indian market. So those are not the major concerns. It’s only valuation as per you. So every market has their own nuances. Now uh standalone if you look at it would it be better if there was no ST? Answer is yes. Would it be better if FBI did not pay short-term long-term capital gains taxes in India? Answer would be yes. But every country has their own nuances. A fact which is not widely known is that if Indian investors were to directly buy US stocks or US mutual funds and the investor passes away, there’s a 40% estate duty payable in the US. Now that is not applicable in India for foreigners investing in India. So every country will have its own nuances in terms of taxation. So dividends in any case are taxable. So if we Indians invest in US, we pay 25% withholding tax in the US. So those are there. Now people factor in post tax returns. So if country A has zero taxes and country B has let us say a 12 and a half% tax people will invest in country B only if it is that much more attractive in terms of the investment opportunities but it does not become uninvestable. uh China will have its own restrictions. For example, the most attractive sectors in China are out of bound for foreign investors. They have to invest in something called variable interest entities. So you cannot directly buy uh Alibaba or a 10 cent or a BYD in China. You have to buy shell companies and ADRs of those shell companies. So every country has its own nuance. It would be better if ST was not there or lower. It would be better if capital gains tax were not there or lower. I don’t think that will be a deal breaker in the long run. Understood. Speaking of the BFSI sector and you have been quite bullish on a few banking companies uh in even in fact in the March disclosures it was seen that few good banking names were also bought alongside IT1s but your in the flexi cap fund your allocation to the sector has largely been confined to 20%. U is there any mandate that you follow internally that you’re not going to take this allocation more than 20% let’s say to 25 or 30%. So banks are roughly 20%. We also have exposure to the financial sector via other companies which give us a play on uh the insurance based life and general insurance or NBFC etc. So as such our mandate is to run a diversified fund and not a banking or financial services fund. So beyond a point we would not look to increase the exposure too much. So uh banking plus other financial services put together would be sub 30% and we are more or less okay with that kind of exposure. Understood. Over the years the allocation to small and midcap stocks has increased a bit but uh still it remains uh low if you compare it with say large caps and other stocks. Right. Is it just a valuation problem that you’re seeing currently or is it something different according to your scheme philosophy? So last few years it’s largely been driven by uh posity of uh ideas in that space valuations being high. So if you look at the market structure today the top 100 companies are classified as large cap companies and these are roughly 1 lakh 1 lakh 10,000 cr is the cutff between large and midcap between midcap and small cap the cutff is roughly 33 34,000 crores. So in the large cap and midcap uh we are pretty comfortable. So a company with 34,000 cr market cap if we buy 10% of it uh 3 and a half or 3,400 crores it’s a meaningful exposure for the scheme as well in very tiny companies obviously it will not move the needle for flexiap on a individual stock basis but what we have said is in the small cap space if opportunities were to come in a meaningful way we don’t mind having a slightly larger number of stocks and this is true for any of the small cap funds that are operating in the Indian mutual fund space. So some of the larger small cap funds in India have as many as 150 200 250 stocks. So in the small cap space if there were to be a reasonable sell off and or time correction and valuations are tracked we’ll have somewhat larger number of stocks in that space. Understood. Close to 60% of the money that is deployed uh in the flexiap fund is towards large cap uh stocks. Right. So why did you think internally that there was a need to have a specific active large cap fund? So we started our usual fund journey in 2013 and almost since the first year in our annual unit holders meeting that we have for our investors. We were asked this question why don’t you have passive funds? Why don’t you launch something like a index fund? And our thinking always has been that if we launch another nifty50 fund or a BC Sensex 30 fund, uh there are already quite a few of these in the market and they are at very attractive expense ratios as well and in index funds there’s no differentiation that you can bring to the table. So what would be the point in coming out with a let’s say parakarik nifty50 fund. So what we said is the way index funds are run in India currently there is some uh scope for bringing out something which in the active space which takes best of the features from index funds as well as active funds which somewhere comes in the between. So what we said is we will largely try and replicate the expense structures of passive funds. So we’ll give a low cost option to investors. Second we said is we will give diversification to investors. In the US context for example when people talk about passive funds people typically think of S&P 500 funds. In India people think of Nifty50. Now between 50 and 500 there’s a big delta in terms of number of stocks. So we said we will start with at least 100. So in firstly we have moved the narrative from nifty50 to nifty 100 in terms of uh giving diversification to the end customer. Then we said we will in active funds capping of position in any particular stock is 10%. we’ll say we’ll keep that so that in a market extreme kind of situation you don’t get overexposed to a particular company. So there is a 10% cap on individual exposure. Then there are some things that index funds are not allowed to do as per regulation which leaves free money on the table in my opinion. Nifty 50 funds have to buy those same 50 companies in the same proportion have the stock in the demat account. Even if the individual stock futures are trading at a discount in the market, the index fund cannot sell the stock and buy the futures. Uh so that I think is easy money which the large cap fund can do. If two companies are merging uh and one of them at least is a index company ideally you should buy the cheaper one based on the exchange ratio. A vivid example of this was HDFC limited and HDFC bank merged. Uh HDFC limited used to trade at a discount of 4%. Ideally one should sell HDFC Bank and buy HDFC Limited because ultimately you’ll get the same company. Index funds cannot do that. The rebalancing is announced 15 days in advance. Whenever the index rebalances, now entire market positions itself for the rebalance. Only the index funds are forced to come on the last day towards the close to rebalance their portfolios. So some of these things we are able to take advantage of in the large cap fund since it’s in the active space. we can actively take advantage of these arbitrage kind of positions and uh hopefully do better for the customer. Understood. Understood. So u if we have to talk about the number of schemes that you have there are largely five to six in number while other AMC’s they have like anywhere north of 20 25 even 30 some some AMCs have more than 100 schemes as well. Um do you have any plans of launching a small cap fund or a thematic fund in the years to come? We don’t have uh any plans as of now. So the attempt is to avail of whatever opportunities that come our way uh in the equity scheme that we run. So the thinking is uh when we launch a scheme there should be a underlying rationale for it. Uh we should be able to do something different. uh as compared to what is already available. We should be excited to put our own money in it. Uh this should not be possible in the existing schemes that we run. So if the mutual fund limits were available for overseas investing, there would not have been any reason for us to launch gift city funds for example. Now that mutual fund limits are restricted and LRS limits are open for global diversification, you need a gift city kind of fund structure. So that was the rational for that. Largely you can classify our schemes into very clean buckets. There is one equity strategy two schemes in that flexiap and tax saver. tax saver again came because of the ATC benefit uh under the income tax act that is one equity strategy there’s cash management strategy which has liquid fund and arbitrage liquid fund is largely used by corporates or other retail investors arbitrage is used by HNIs who are in very high tax brackets again very simple to hybrid funds where you need a dash of equity to protect against inflation and you are largely looking for a low-risk stable kind of portfolio. So two hybrid funds. So these are the three buckets and we have the large cap fund which we are trying to offer an alternative between the active funds and passive funds in the large cap space. Very simple architecture. This is what we expect to run. uh whatever other scheme categories are there we closely keep watch on what is happening so sifs were launched some time back now as of now we don’t have any plans of launching there but we are watching that space uh is there a product cap is there something we can do differentiated as of now no plans of launching SIF small cap or any thematic funds understood so you’re saying the kind of arbitrage opportunity unities or special situation opportunities that are available in the large cap scheme. You can deploy those kind of opportunities in the midcap and small cap space within your flexi cap fund. Is my understanding correct? So flexiap is relatively concentrated where we will be very different from what the index is. We will be in cash if required. We will be fully deployed if required. That’s the approach. We will switch between large cap, midcap, small cap if opportunity is given international as well. So that is uh go where the opportunity is. The large cap fund starting point is Nifty

100. We will deploy in the 100 stocks which are in Nifty 100 and then whatever opportunities are there either by taking advantage of differences between uh cash market and futures market or merger related arbitragees uh or rebalancing or spin-offs. So those specific category of uh advantages those wheel avail.

How do you reconcile identifying secular trends like EVs, AI and balance between not paying for the story premium? So sometimes what happens is uh after the initial hype uh people get disillusioned even by secular trends. So internet as a theme came in mid ’90s. It continues even today. It’s still a theme which is playing out. But people got disillusioned with internet in 2000 2001 2 there was a big selloff lot of people a lot of companies burnt out and then there were opportunities in the surviving companies. So in themes which last decades it’s not necessary to be the first one in that theme. Shift of telecom from landlines to uh cell phones and uh almost universal cell phone coverage is a theme which played out over 2530 years. Uh the first lot of companies went bankrupt. Hardly anyone survives except Bharti. No one has survived or made money. Vodafone idea has survived but not made money. So it’s not necessary to be the first one. You have to take your time. Apart from the secular theme that is there, you need good management quality. You need balance sheet strength. Uh you watch their execution in the marketplace. you watch for consolidation and then you will get an opportunity to buy that that’s been the approach we have had. Understood. So u if we have to talk about other asset classes like uh gold or what’s your view on what’s your view on an asset class like gold then I’ll come to reads and in bits and everything. There can be different asset classes. In my view, only assets with inherent cash flow you can value as investments where there’s a framework. There are other assets which definitely have a value in exchange. So if I had gold, I would not throw it away. But they don’t generate any inherent cash flow. And the how much price you’ll get for it depends only on demand and supply. So gold, silver, crypto, art, watches, fine, wine, all of these are in that category. So that really depends on individual preferences. I don’t have a view on what these asset classes will do. If you ask me about equities, if you ask me about REITs, invits, bonds, warehouses, aircraft leases, one can estimate the cash flows. One can estimate how much maximum you should pay and at what price you should let the deal go away but there’s no such benchmark for these assets. Understood. Speaking of reads and invits, uh what are your views on these asset classes and is there any uh outlook towards launching products in this category? So we have been uh big investors in REITs. So out of the listed reads now as per public disclosure we are close to 9 and a half% in two listed reads. These are good assets uh between pure equity and fixed income. They are more equity like SB has also classified them under equities. Now the good part is here they pay you quarterly payouts and apart from the payouts you have some capital appreciation also coming in over time. So lot of these are trading at yields around 6%. If you add 5 to 6% capital appreciation to the 6% payout yield, you are well in double digits which is not bad uh return given the stability and predictability of these inits. There’s a variety of invits. These are slightly complex instruments. Uh I think retail should definitely stay away from invits. they are better suited for REITs and inits also one has to do diligence. So uh road projects could have traffic risk for example or uh transmission assets may have a risk in terms of uh future expenses uh how much expenses will increase and what will that will do to the payout will that remain stable or start declining. Uh so each asset class comes with its own uh challenges. So there are road invits, there are transmission invits, uh there are uh gas pipeline invits. So there there’s a large uh telecom tower invits, a variety of invits and each uh is unique in its own way. Uh one mistake people should not make is that lot of people look at this quarterly distribution per unit was let’s say 1 rupee. They will multiply it by four. Four is the annualized distribution per unit. And then they will divide it by let’s say the price of the invit. If that is 40, they will think that this is yielding me 10%. But that can be misleading because here part of that distribution per unit could also include your own capital. It may not have a terminal value or it may not be a sustainable payout that one rupee could fall to 75% down the road etc. So be careful is my advice there. Understood. What about uh the NPS space? I understand that PPFS has recently fored into this space. What are your views on it and is it an alternative to mutual funds or it is a different uh asset class that should coexist alongside mutual funds in the investors portfolios? So largely uh this sits somewhere between mutual funds and EPFO. Uh all are wonderful products EPFO, NPS as well as mutual funds. Each will have their own uh use case. So for a lot of government employees especially the newer ones NPS comes as a default and they uh start investing in it. So NPS investors who are from the government sector should take a look at what allocation they’ve chosen by default. Do they need to change that? Which are the managers managing that? And they should maybe once a year keep track of what is happening in the NPS space. It is also attractive for uh people in the private sector. So depending on people’s tax labs uh life goals, they can also consider investing in NPS. The good part is the company’s contribution to NPS will not count against your salary up to certain limits. If you if the company is investing 100 on your behalf in a NPS, the full 100 gets invested. Whereas if someone is in the 30% tax lab, if the person chooses to take money from the company, then 30 will be deducted out of 100 and the individual will be left only with 70 to invest in a mutual fund. So it depending on the tax lab employment status, it will be suitable for some people, it may not suit some other people. Also under NPS lot of reforms are happening. There are some innovative uh schemes for minor children. NPS Watsalia. Uh Sukanya Samrit is available only for girl child. Watsalia is available for all children. Uh so some of these are interesting. some new experimental products are in a sandbox stage using the NPS mechanism for medical needs. So some uh experimentation is happening there. So it’s a interesting space for people. It serves different needs as compared to mutual funds. Understood. Coming to our last set of questions. Uh this is something that you have also spoken about in the past and I would like to hear it from you again. what is a reasonable return expectation that people should set for the nifty50 index or the nifty 500 index for the next 5 to 10 years. So over medium to long term what happens is whatever is the nominal GDP growth of a country somewhere or the other gets reflected in the corporate sector earnings growth and corporate sector earnings growth gets reflected in stock prices. So of course there are leakages sometimes one runs ahead uh sometimes to get that growth companies may need to dilute equity but if broadly we say 6 to 7% real GDP growth and we say let’s say 5% kind of inflation we are talking about a 11 12% kind of nominal GDP growth so that seems to be a reasonable benchmark for equity returns. Understood. Given these turbulent geopolitical times, what is your advice to the advisers who eventually guide their investors in terms of their uh goal planning etc. What would you like to advise them as to how they can better advise the end investors? So firstly uh don’t pay too much attention to this. That’s a simple advice. uh today we would be largely worrying about the US Iran or Israel Iran conflict the closure of state of Hormuz uh a few years back we would have worried about Russia Ukraine war now Russia Ukraine war started it’s still going on but that does not make headlines so much so people are just companies are just countries are just Sometimes the thing goes away. A war which starts may end any time. Uh so what matters is staying the course living through the ups and downs and uh allocate assets wisely. Any money that you need in next 1 2 3 years should not be in equities. uh short-term money should be in liquid funds, money market funds, arbitrage funds, bank FDS, those kind of products. Medium money can be in hybrid funds can be in bank fixed deposits. Longerterm money, don’t keep in fixed deposits. Try and allocate more of that to growth assets like equities, REITs, and then stay the course. I don’t think it’s very complicated. Understood. Coming to our last set of questions and we have a rapid fire round here. So while you have answered almost everything quite in depth but u just for this round which sectors are you the most bullish on banking IT services and reads? Okay. Any plans of uh launching thematic or sectoral funds at all? No. Understood. Views in passive investing. It’s good for people who don’t want to track markets or even for others for a portion of their assets or people who really want to deep dive active could be a choice. Are Indian IT companies here to stay? I think so. Yes. And what should people do in these turbulent times? Should they be disturbed or should they stay the course? Sleep well. Understood. Thank you so much. It was a wonderful conversation. any closing notes that you have for us? Wishing all the listeners a very happy investing journey. Thank you so much. Thank you so much.