He further said India has to grow 7-9 percent, but for that credit freeze, which has been spreading and causing havoc, should be solved
So far, elections results (leads and wins) indicate Narendra Modi becoming Prime Minister of India again, the fear of fractured mandate is behind us, said Raamdeo Agrawal, Co-Founder, Motilal Oswal Financial Services in an interview with CNBC-TV18.
The 20 bps fall in bond yields also indicate that fear of uncertainty is over, he said. There is stablility, and generally, the bond market salute is bigger than equity," he added.
In BJP manifesto, the opening letter by Modi said they have taken a lot of tough action in the last five years and now swift action will be taken, going ahead.
Hence India will do well as the country has its own canvas, he said, adding it has seen re-rating in the last five years and will see earnings growth in the next five years.
He further said India has to grow 7-9 percent, but for that credit freeze, which has been spreading and causing havoc, should be solved.
Raamdeo's portfolio has given a 20 percent plus return in the last five years. Now he confidently said in the next five years, the market will double or my portfolio will double. "If I don't double my money in the next five years, then it will be disappointing."
"Oil will come down, exports growth will start, the government will do something more, the interest rate will fall—these could be beneficial for equity and portfolios," he added.
Modi is passionate about infrastructure as his key themes are housing for all by 2020, doubling of farmer income in the next 2-3 years and 65,000 roads in the next five years, Agrawal said.
The auto segment has been under pressure especially since September 2018 when the liquidity crisis occurred. Stocks fell quite significantly on slow down in monthly sales.
Raamdeo is confident about recovery in auto stocks but that could take another six months or one year also. "We are $2.5 trillion year economy and will be $5 trillion economy in the next few years, so everybody will buy cars and lot more automobile will be sold. The current problem is temporary."On the domestic risk front, he said earnings (if don't see recovery) is the biggest risk.
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