Despite current volatility, India remains a long-term destination says Kotak's Nilesh Shah

dded that till the time there isn't more clarity on policy stance, markets are likely to remain volatile.

Even as the stock market stooped to a four-year low, and indices plunged to record levels due to a rather weak election for the BJP-led National Democratic Alliance (NDA), veteran fund manager Nilesh Shah believes that India still remains a long-term destination for growth.

"We are in a good momentum with 8.2 percent GDP growth for FY24, oil prices are coming down as OPEC has proposed to increase supply over next 12 months and our peers are also going through serious upheavals," the Managing Director of Kotak Mahindra Asset Management said in a conversation with Moneycontrol.

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He said that Russia is engaged in a war with Ukraine and China and Taiwan are struggling with the real estate will make India an attractive investment destination. Shah also says that the for the first time ever, FY24 saw Nifty 50 earnings topped initial estimates at the beginning of the year.

Also read: Stock Market Crash | Sensex, Nifty plunge over 8% each; PSUs, mid and small caps bleed

During today's crash, PSU stocks were hit the hardest, with trading in many of them being temporarily suspended after a 15 percent decline. BEL, PFC, and REC were among the major losers, dropping between 15-20 percent. In addition to these, financial services and oil and gas stocks also suffered significantly as panicked investors liquidated their positions.

Read more: India VIX Jumps 39%; Nifty Sees Biggest Single-Day Fall Since February 2022

Shah also commented on PSUs, stating that in this kind of market churn, 'the men get separated from the boys.' He believes that in such a market, quality will outperform momentum. PSU stocks with a large float and optimal price discovery by market forces should outperform those with low floating stock and concentrated holdings.

Read: Share Market Crash: Nifty PSE down 19%, trading halted in key shares as trends show weaker majority for NDA

Lastly, he added that till the time there isn't more clarity on policy stance, markets are likely to remain volatile. Is this a buy on dip opportunity? Shah recommends investors to follow the 'dharma of asset allocation' but advises investors to not put everything at one go and wait for the uncertainty to get settled.

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