Sunil Singhania, CIO Equities, Reliance Mutual Fund
One theme that has been emerging quite strongly in terms of at least private equity moving to that space is e-commerce. We are looking at Flipkart being valued close to $8 billion. What are these new sectors or themes that you are witnessing as of now?
India is a great country. It is a country led by entrepreneurs, driven by entrepreneurs and I think that makes it all the more interesting from an investor's perspective because you have so many different options.
We believe that India is behind the world by 15 to 20 years, but that's an advantage. Because what has happened in the other parts of the globe is ultimately going to happen in India.
Look at building material companies. Two to three years back we felt that once the standard of living rises, once urbanisation happens, then more houses will be created. Naturally, the tiles and the sanitary ware companies would do well.
I think a similar theme, which is a little difficult to actually execute from an institutional perspective, is home grown brands. The largest textile brand in India, for example, is only $200 million. I mean you can't have 25% of the world's youth in the country and some small brand in Europe worth $20 billion and in India worth only $200 million. One small subtheme which we feel is going to be interesting are home grown brands – shoes, textiles, tiles, or something else. I think it will be a very strong theme as we move forward.
What looks more attractive right now from a one-year perspective, equity or debt?
We are playing with one major aspect in mind; between 2014 to 2020 earnings will triple. Now if the market starts to discount that earlier, we might make returns in one year. If the market basically discounts it a little back ended then there is a possibility that one year might not lead you anywhere.
When you are looking at investing in equity, look at it from a wealth creation point of view, not from creating income. If you want to create income, there are different avenues available for you. But if you want to create wealth, look at investing in equity.
We are already among the top 10 markets in the world. From $2 trillion, we're going to $4-5 trillion in the next 6-8 years. That is a kind of wealth which will be created eventually. So have focus, be long-term and you'll make money.
Prashant Jain
Anoop Bhaskar
Mahesh Patil
