Large-caps should do slightly better than mid-caps over next twelve months: Ajay Tyagi

UTI Mutual Fund executive vice president and fund manager Ajay Tyagi remains bullish on equity despite the recent volatality on the Dalal Street. In conversation with Krishna Kant he discusses how plans to steer UTI’s various equity schemes that he manages

The year has started on a bad note for equity. What do you see this?
How the year starts has no bearing on how markets will end the year. I expect equities to surprise us on the upside by the end of the year. There are hardly any alternatives available to investors right now and perhaps this has been driving strong inflows into equity mutual funds for some time now. Although flows could moderate but the direction may not change in a hurry as competing asset classes such as real estate are going through their own set of challenges.

Thanks to the recent correction valuation is now attractive. Benchmark indices are now trading at 14-15  times one-year forward earnings, closer to their 20-year average ratios. This was not the case a year ago.

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