Brexit an event that will pass, not 2008 crisis: Jeff Chowdhry

Britain's decision to leave the European Union is not a repeat of the 2008 crisis, says Jeff Chowdhry of LGM Investments, explaining that Brexit is an event that will economically and politically impact EU and Britain unlike the financial crisis seen back then [which had a global impact].

In an interview to CNBC-TV18, Chowdhry says now that David Cameron has resigned, central bankers and politicians will stabilise the ship and markets will follow suit.

He does not expect any major foreign fund outflows from India due to Brexit. In fact, he believes it is a good time to selectively pick up quality companies.

The bigger issue that people are not talking about yet, according to Chowdhry, is the US economy hitting a soft spot again. Below is the verbatim transcript of Jeff Chowdhry's interview with Latha Venkatesh and Anuj Singhal on CNBC-TV18.Latha: What’s your reading of the situation? In India itself markets have staged a very decent recovery and there is a goodish bit of recovery in the pound as well. Should we understand that this market has priced it in, what’s your view as an investor?A: It is fair to say that obviously the initial reactions in the markets in terms of the surprised vote was as absolutely expected, a huge plunge in all of the weak assets and one of that we look for example is yen and we saw big move in the yen which was huge. I think even though the David Cameron has now resigned, what will now happen is that both central bankers and the politicians will rally around. I think we possibly seen the lows now for the markets, that we saw 3 or 4 hours ago and from now we will get stabilisation if not a bit of rally from EM.Latha: Do you buy any of the Indian stock you are such a long India watcher.A: One of the things when you have a sort of a general risk on or risk off, everything is kind of what they say is the baby gets thrown out with the backwater and definitely in a situation where stocks get sold are, which really don’t have any connection or linkage. It always an opportunity to say that, “oh this stock which I really like is now down 5-10 percent from two days ago is a great buying opportunity”, so selectively for quality companies yes one should be buying in my opinion today.Anuj: What about fund flows. Do you think there is a risk that especially for emerging markets given the kind of uncertainty that we have right now we have to deal with a bit of an outflow and maybe much less inflows compare to say what we were seeing about 2 or 3 months back.A: The most important thing to point out is that this is not 2008. This is an event which has obviously affected Britain and Europe economically and politically. This situation will pass. The politician will stabilise the ship and remember it two years before Britain comes out of Europe and as a result of that the main issue really is certainly looking for companies which had been hit very, very badly and picking them up and I don’t think emerging markets are going to be massively affected overall by this news or by this event.