Why Indian market is holding up better than global peers? S Naren explains

Sankaran Naren, chief investment officer, ICICI Prudential AMC

ICICI Prudential’s chief investment officer S Naren has said Indian markets are looking at structural growth triggers and not the problems of high valuation and crude. This is the reason why the Indian market is holding up well against global peers. Going ahead, megacaps will outperform, he said.

“In the recent past, markets such as that of the US and China have come down. But India is one of the few markets that is still up because of the structural story and that the domestic investors are very positive on equities,” Naren told CNBC-TV18 in an interview on September 27.

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In terms of sectoral picks, the veteran investor is bullish on the auto sector but remains cautious of hindrances such as technology changes and the lack of growth in the two- wheeler industry. However, he believes that the sector may cyclically benefit in the coming few years.

Naren acknowledged “over ownership” of private banks has led to their underperformance over PSU banks. He, however, remains optimistic on the private banking space, suggesting thorough risk and positioning analysis.

On the other hand, the five-year-long underperformance of the consumption sector has flagged caution in the market expert’s mind. Naren also sees contrarian opportunity in REITs, which have been underperforming lately.