The 7th of every month is Mutual Fund Day here at the CNBC-TV18 stable. In an interview to CNBC-TV18, Navneet Munot, CIO of SBI MF shared his views and outlook on financial health as well as his expectations from Reserve Bank of India (RBI) policy.
“Most of the money is coming through the systematic investment plan (SIP). Investors are becoming more mature and taking a long-term view,” he said.
He believes, a good part of household savings are moving towards the financial assets and the whole financialisation of savings is a bigger trend.
From India’s perspective, historically we have danced to the tune of the global risk-on and risk-off, global risk appetite but now with increasing flows from the domestic investors, volatility is going to be less, he said.
“So much of money has flown into the mid-cap and small cap space and there are pockets where some froth got created,” said Munot.
He sees two parts of market where on one side there are stocks where earnings momentum is very strong, valuations are high and on another side there are large number of sectors and stocks where valuations are low because earnings momentum is not strong.
In IT sector, there are a very few names where the valuations give higher comfort and there are places where earnings momentum is strong. SBI MF’s portfolio is a combination of both, he said.
According to him, IT is going through a serious challenge in terms of how the business has been in last 25 years but global IT market should be larger in the next 25 years. “In five years Indian IT market is going to be quite big,” said Munot.
There are going to be huge opportunities in India also, he mentioned.
"If you look at the incremental data points in the last few weeks, oil prices are down, currency is appreciated, monsoon is well on time, GST is not inflationary, considering all that, I think RBI may not change their stance but they will be less hawkish this time," he said.For full discussion, watch accompanying video...