Daily Voice: Good monsoon, tamed inflation may give RBI MPC room to cut rates, says Shriram Wealth's Vikas Satija

Vikas Satija is the Managing Director & CEO at Shriram Wealth

Vikas Satija, Managing Director & CEO of Shriram Wealth, told Moneycontrol that the market is currently in a consolidation phase. He added that as corporate earnings improve from high single-digit levels and tariff concerns ease, equities should gain momentum, supported by foreign institutional inflows.

He further added that a favourable monsoon and controlled inflation could provide more room for the central bank to cut rates, which may further enhance positive sentiment in the markets.

Meanwhile, Satija maintains a positive outlook on the defence and power sectors. He believes that India’s power demand is set to grow much faster than previously expected in the coming years.

Do you strongly believe the India–US trade deal could be a game-changer for the market’s trajectory?

India–US trade deal offers sector-specific benefits in electronics, agri-tech, and industrial goods, but not as a market-defining catalyst. India’s growth trajectory is anchored in domestic consumption, infrastructure investment, and manufacturing self-reliance.

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Vikas Satija

MD & CEO|Shriram Wealth

While a trade deal could support export growth, it is unlikely to materially shift the country’s fundamental drivers. Investors should track tariff changes at the sectoral level but focus primarily on India’s organic growth levers. Thus, the Indo-US trade deal does not seem to be a game changer, but it will improve the sentiment of the market.

Are the markets, economy, and corporate earnings at an inflection point?

Markets are in consolidation phase. The Government and Central Bank have, in the last few quarters taken various positive measures. Its impact on corporate earnings is now being closely watched. As corporate earning starts improving from the current high single digit level and tariff issues settle down, the market should show positive momentum along with inflows from foreign institutional investors.

Favourable monsoon and control inflation may give more room for central bank to cut rates which may further enhance the positive sentiments. Growth may be driven by domestic consumption, government capex, and services exports.

Are you bullish on the entire consumer discretionary sector following recent policy changes by the government?

The Direct Tax rate cut along with the benefit from GST 2.0 and easing of interest rate should definitely improve the discretionary spending, thus boosting the consumer discretionary sector.

Do you maintain a positive outlook on the defence and power sectors within the capex space?

We maintain a positive outlook on defence and power sector.

For the defence sector, Government initiatives have shifted from an import-led to an indigenization-focused strategy. Demand remains large, as the government continues its endeavour to overhaul and update the defence equipment to the latest, modern specifications. What we're seeing now is only the initial phase of a multi-phased, high-growth sector with sustained demand ahead.

India’s power demand is set to grow much faster than previously expected, and it’s not just because of industrial growth, the real driver is rising income levels and growing aspirations of Indian households. As the economy grows, per capita income will improve and this will lead to higher discretionary spending driving the growth.

The power demand is projected to grow 10% annually in the next 5 years due to aggressive electrification drive. Renewable energy will dominate new additions. The conventional correlation between GDP and power demand is undergoing a shift. Historically, the peak power demand grew at 0.85 times the rate of real GDP growth. However, this is expected to rise to nearly 0.92 times with extensive electrification across industries and households.

With gold becoming increasingly unaffordable, do you think silver is emerging as the new gold?

Silver plays a dual role as a precious and industrial metal. With rising demand from clean energy & other segments and gold above $3,800 per troy ounce makes silver relatively affordable. This will drive investments in silver as a commodity due to the relative valuation comfort.

However, it will be difficult to match gold’s cultural significance, price stability, or role as collateral. The shift can be viewed more as a sign of diversification, not substitution—silver is expanding in specific investor and industrial segments, while gold continues to anchor the market.

Following the H-1B visa issue, what do you think could be the next item on Trump's radar as a negotiation tactic?

It is difficult to say anything at this point. However, India is a resilient and robust economy with a zeal to thrive. We have a strong and highly skilled workforce, growing economy, and a strong GDP growth rate. We believe that India will adjust and continue to thrive.

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