Raamdeo Agrawal bets big on digital platforms; some will fail but growth potential unprecedented, he says

Raamdeo Agrawal said that the Indian capital market is becoming deeper with more participation from various categories of investors, especially retail.

Many internet-first businesses will come to the markets and spread like fire, says Raamdeo Agrawal, chairman and co-founder, Motilal Oswal Financial Services. The pace at which these companies are growing is unprecedented even though many platforms are yet to be listed. Some will fail too but those that click will grow significantly, says the market veteran.

“Internet (digital businesses) will come to the market and spread like fire. While we have a few digital companies that are listed, there are many firms that are yet to come to the market,” said Agrawal while speaking at an event organized by Motilal Oswal Wealth Management.

“Some will fail too but those that click will actually show a strong growth over many years. This is because internet-based companies grow and scale at a very quick pace,” added the market veteran.

Interestingly, Agrawal also touched upon the massive recent surge in the valuation of Nvidia to become the world’s largest listed company. He said that while India may not have a semiconductor giant like Nvidia, we will have our own versions of companies in the digital space that will have the potential to become big and become multi-baggers for the investor community.

“There is no caste or creed in the market. There is only earnings and earnings growth. When we say that our economy will double in size in the coming years then we will definitely see many more new companies coming to the market and some of those will become huge along with the economic growth,” said Agrawal.

On a different context, Agrawal said that the Indian capital market is becoming deeper with more participation from various categories of investors, especially retail.

“Participating in the Indian market is increasing. Earlier, promoters used to own a majority of the market. Now that share is reducing and retail share is increasing. This is a big trend and will continue,” explained Agrawal.

He, however, cautioned that while huge money has been coming to the markets in the last few years, there has been no big change in the earnings.

“Markets will see correction but investor should not be scared. Investors should not do anything that they do not understand. Keep it simple,” he said.

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