Maintaining investor trust is most critical in the market, says HDFC MF CEO Navneet Munot

Navneet Munot, MD & CEO of HDFC Mutual Fund

The Indian stock market in general and the mutual fund industry in particular is poised for strong growth in the coming years due to a combination of factors including current level of under penetration, transparency, technology, and trust, says Navneet Munot, MD & CEO of HDFC Mutual Fund.

While speaking at a conference organised by Motilal Oswal Wealth Management, Munot said that while the market is witnessing record SIP flows in the recent past, there is not much to worry as the flows are unlikely to dry up.

"Many a times I am asked when will the (SIP) party end. I tell them party to abhi shuru hui hain," said Munot while speaking at a conference organised by Motilal Oswal Financial Services.

The veteran fund manager further highlighted the fact that while the Indian markets are very advanced in terms of technology, the mutual fund product is one of the most transparent globally.

"The Indian mutual fund product is one of the most transparent products and you will not get such a product anywhere in the world. Even if you look at technology, Indian market is far ahead of other global markets," said Munot.

Munot further stressed the fact that there is huge scope for improving the penetration level of the Indian mutual fund industry. He asked the distributor and advisory community to go beyond the top cities and get new investors to the market.

"You look around in your respective cities. There will be many who ate yet to cut the first cheque. Look at the data for the last 10 years and you will realise the huge scope for improving the penetration level," explained Munot while adding that one can participate in the compounding growth story of India with as much as just Rs 1,000 per month.

Munot also said that the mutual fund industry is working hard on training and investor education as well with campaigns like 'Mutual Funds Sahi Hain' making a strong impact.

Lastly, he stressed on the trust element and cautioned the industry against doing anything that breaks the trust of the investor.

"Don't do anything that breaks the trust of the investor in the capital markets. If that trust is maintained and strengthened, the future would be very strong," said Munot.