Krishnamurthy Vijayan, MD & CEO of IDBI Mutual Fund says that the enabling of foreign investors to invest in domestic mutual funds has opened up a lucrative source of investment
Mumbai:
How significant is the easing of the procedure for FII investments in Indian mutual funds? In your opinion, how will it impact the inflows in the mf industry?
It is difficult to say at this point with no details on procedural aspects. Inflows into the MF industry should definitely improve on the back of this.
What will be the overall impact of the budget on the stock markets?
I think the market has viewed the budget positively, given that they have not upset the apple cart too much. The macro indicators beat the street expectations positively. Sector wise it was a mixed bag with negative repercussions for commodities, oil marketing companies, hospitality whilst it was positive for banking, auto, education, fertilizers and infrastructure. All in all, a neutral budget with a positive bias. Market is more relieved with the event done and over with so that the participants can focus now on other variables.
Any sectors that will require a re-rating as a consequence of the budget announcements?
Re rating is too strong a word. Various sectors notably auto, FMCG, banking, fertilizers, logistic companies, and consumer durables have positive repercussions from the budget.
Has the budget made the case for investing in equity funds stronger?
Yes it has. The government has set in place a balanced macro economic growth path with a view to continue growth and curtail inflation, infuse liquidity and make the environment more conducive to overall equity investment. Sector wise as well there have been some positives. All in all, it has provided moral support to equities.
Finally, how would you rate this budget in terms of its impact on the mutual fund industry?
A definite positive impact is the enabling of foreign investors to invest in domestic mutual funds; this would allow us to tap into a lucrative source of investment. How it pans out in terms of procedural details would be something to watch out for.
