C Jayaram of Kotak Mahindra Bank said there is not enough conviction in the pullback seen. He told CNBC-TV18 that it is a period of wait and watch.

Jayaram added that the worst is probably over or seems factored in the markets on the global side. The lows at about 14,800-14,900 levels are possibly the floor and will probably be tested at least once more, he stated.

Excerpts from CNBC-TV18’s exclusive interview with C Jayaram:

Q: There seems to be a very tight fisted mood among the domestic money managers. What is happening with the market?

A: There is still not enough conviction in the pullback we saw a couple of days back. Given the current environment, people keep waiting for cues from the US. In recent times, there has been some talk that European banks may have some write-downs as well over the next few days. So, it is essentially a period of wait and watch.

The worst is probably over or seems factored in the markets on the global side. To that extent, the lows we saw at about the 14,800-14,900 levels are possibly the floor. It is probably going to be tested at least once more.

Q: What is the liquidity situation looking like? You are now one of the largest asset managers on the overseas front as well. Do you sense that with the return of positive figures for FIIs in the last 2-3 days, that gap is beginning to open up or is it premature to say that?

A: Even during the worst times when the markets actually fell dramatically, we did not see too much redemption in our overseas funds. The fund size under management probably would be coming off because prices were coming off. But we did not really see too much redemption. While fresh money that can be raised there might still take some time, I don’t think there is any lack of liquidity available in that sense to come in.

Q: For people who specifically run their money through you, do you see an inclination to hold back a little and see the situation clearing in that sense. Were you sitting on a lot of cash on their behalf that needs to be deployed or not quite?

A: I am not entirely sure it was that because a lot of them were pretty much invested into the markets. But people who had managed to raise fresh money just before the fall or had seen some inflows into their funds, some of them were waiting to see how the whole storm would ride out and not really rushing in to invest.

Q: There were some concerns on what this entire month had done by way of margin call pressures through a lot of HNI people. Did you get a sense that the whole HNI clientele was getting crunched very hard, in terms of liquidity, because of the damage that happened in the markets?

A: At least from our perspective, much of the damage inflicted on HNIs, margin calls etc, had sort of blown over in the first phase itself. Some of the margin calls that got triggered in the last fall the last time around was essentially on the back of some promoters who had borrowed against their promoter holding.

That is not something that we do as a firm. So, I wouldn’t be able to comment too much, but this is what one has heard in the market.

Q: What are your total assets under management now on the overseas front at Kotak?

A: On the overseas front, it would broadly be in the order of about USD 2.7 billion, especially the funds under management and the advisory put together.

Q: None of it was through the P-Note route from any of the clients?

A: Not really. We haven’t got a P-Note programme through any of the clients.