Mutual Fund Summit | Top CIOs back India's fundamentals and liquidity support amid ongoing global conflicts

Mirae Asset Investment Managers (India) CIO Neelesh Surana believes that in the current situation, India’s resilience stems largely from sound domestic fundamentals and the absence of a major oil shock.

Leading mutual fund money managers have echoed their focus on domestic fundamentals and robust liquidity in Indian markets, at a time of sustained geopolitical turmoil and risks to global trade, while speaking at the Moneycontrol Mutual Fund Summit 2025 in Mumbai on June 23.

Shridatta Bhandwaldar, Head - Equities, Canara Robeco AMC said any attempt to time geopolitical developments isn’t part of a portfolio manager’s job. “I don't think we can predict these things. What we as portfolio managers are actually trained to do is, how can we actually find out businesses, whether it has sectoral level or individual level, who can actually create basically free cash flows over a period of time and redeploy them in a good manner or operating cash flows and redeploy them in a good manner,” Shridatta added.

The approach, he said, is to stay invested regardless of market turbulence. “We always remain fully invested upwards of 90%. We don't keep cash. That's one of very, very fundamental tenet that basically investor has allocated money. We believe as a house, we are fairly conservative,” explained Shridatta.

Axis AMC’s CIO Ashish Gupta said in the current environment, no one market is safer than another, and the geopolitical developments across the globe impacting everyone, not just India.

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Ashish Gupta said India could be seen as either more immune or more vulnerable depending on how one views its external dependencies. “Some will argue India is more immune to some of these pressures. Of course, there is geopolitical trade pressure. So, you can say India is more immune. We are not so externally dependent. You can also argue that because of oil, our dependence is higher. But the fact is that if I look at all sum total of risk, whether on trade, whether on geopolitics, the whole world is affected,” the Axis CIO said.

Gupta added that money doesn't have a clear place to hide in this period of turmoil, with equity and bond markets across the world facing similar challenges. “You are also seeing as much risk in other asset classes, so whether it is equity or bonds. And there are some consequences is that none of the markets are therefore able to react to it, right? So, what do you do? So, if you sell India, do you go to China? Do you go back to US? Do you go to Europe?” Ashish Gupta questioned.

Global markets have performed surprisingly well, the Axis CIO said. Calendar year, most of the large markets have performed in-line or even better than India. "…it's not that India is outperforming. You look at many European markets, they are actually up 25-30 percent. Korea is up 30 percent. Initially, the narrative was that money is moving out of the US. US market is correcting and therefore all these markets are going up. But US market is also back close to all-time highs," he said, adding that in this context, liquidity is the key driver.

Mirae Asset Investment Managers (India) CIO Neelesh Surana said India’s resilience stems largely from sound domestic fundamentals and the absence of a major oil shock. “Markets have been fairly resilient maybe because India macros were good. But purely on these events, despite that, I think what could have impacted the macro economic parameters in the near term would have been spike in oil prices,” Surana said.

That risk, however, hasn’t played out, said Surana. “Somehow that also most experts are saying that because of supply dynamics, oil prices would not shoot up as much. But that could have actually impaired many of the macros things.”

On Mirae Asset holding more cash than peers, Surana said this wasn’t due to geopolitical factors. “It's not linked with the macro at all, or the geopolitical conflicts. We are deploying cash wherever we are finding opportunities, otherwise we are staying in cash,” he added.

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