SIP flows may cross Rs 20K cr pm in 2024: Pankaj Pandey
“Young investors have become aware of the benefit of compounding and how easy it is to accumulate Rs 1 crore by a small amount of SIP if it starts early,” says Pankaj Pandey, Head of Research, ICICI Securities.
In an interview, Pandey said: “There is little doubt that the year 2024 will not see monthly SIP amount crossing Rs 20000 crore per month,”
Samvat 2080 started on a positive note as the markey picked up momentum. Where are markets headed?
Positive catalysts such as robust corporate earnings (likely to grow at 16.5% CAGR over FY23-25) and Favourable Growth-Inflation dynamics India (~6-7% sustainable growth with comfortable inflation of ~5%), make India an outlier as an Equity investment destination in the medium to long term amid the milieu of dwindling global growth and geopolitical concerns.
Going ahead, we expect Nifty EPS to grow at a CAGR of 16.5% over FY23-25E. Our one-year forward, Nifty target is at 21500 (20x FY25 EPS) with sectoral bias towards banks, capital goods/infrastructure, and power, while avoiding sectors having more global exposure like IT, oil & gas etc.
September earnings season is over – what were key highlights according to you?
Corporate earnings in Q2FY24 came robust with PAT growing 31% on a YoY basis at the Nifty Index level. It was largely led by expansion in gross margins (up 540 bps YoY).
Topline growth for the quarter came in muted (2% YoY) largely led by a decline in commodity prices in metals and Oil & Gas space.
The management commentary was positive around the festive season. Automobile space witnessed healthy rural demand recovery while the same for FMCG space was below expectations indicating K-shaped demand recovery domestically.
Corporates continue to be enthused by robust infrastructure spent by the government thereby stimulating core economic activity.
Similarly, in the mutual fund portfolio, the best-performing fund of the year 2023 may not be the best-performing fund in 2024.
Therefore, it is important to not chase the best-performing fund and invest based on the individual fund’s portfolio positioning and the fund manager’s experience of managing volatility as the year 2024 may be volatile.
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