In an exclusive interview with Moneycontrol, Shiv Sehgal, President and Head at Nuvama Capital Markets, advocates a conservative wealth allocation strategy for Samvat 2080. Despite recommending a cautious approach, Sehgal expresses perpetual bullishness on equities, attributing it to the dynamic nature of the Indian market.

Sehgal prioritizes large-cap equities, bonds, and gold, foreseeing a promising outlook for the yellow metal in Samvat 2080. Emphasizing a potential new era for gold, he underscores its resilience, particularly during uncertain times when the USD loses its safe-haven appeal.

Key Points from the Interview:

Domestic Flows: Sehgal anticipates robust and sustained Domestic Institutional Investor (DII) flows, considering benign domestic liquidity conditions. However, he notes that global uncertainty may cause Foreign Institutional Investor (FII) flows to remain volatile.

Mid-Smallcap Space: Sehgal acknowledges the notable expensiveness of the Small and Mid-Cap stocks (SMID) space. While he identifies potential risks to midcap valuations, he highlights ongoing SMID fund inflows and sustained sector interest as factors that could keep valuations elevated.

Auto Industry: Sehgal observes that the automotive industry has achieved significant margin expansion, with comparatively lower downside risks. He expects good margin expansion in autos but foresees a consumption slowdown in the coming quarters.

Equity Market Outlook: While Sehgal predicts a favorable year for large caps, he maintains a bullish outlook on midcaps despite ongoing consolidation. He emphasizes the segment-specific consideration for evaluating whether Samvat 2080 will be better or worse for equity markets.

Preferred Investments: Advocating a conservative approach for wealth allocation in Samvat 2080, Sehgal prioritizes large-cap equities, bonds, and gold as the most promising prospects.

Gold’s Significance: Sehgal positions gold as a resilient asset during uncertain times, suggesting that Samvat 2080 could mark a new era for the precious metal.

New Age Tech Space: Sehgal expresses a positive outlook on the new-age tech space, maintaining optimism based on factors such as a shift towards profitability and reduced cash burn.

Domestic vs. Export-Oriented Sectors: Sehgal favors domestic-oriented sectors, emphasizing the strength of India’s consumer economy with a population of 1.4 billion. He highlights the reduced uncertainty in growth for domestic-oriented sectors compared to export-oriented ones.

As Samvat 2080 unfolds, Sehgal’s insights provide valuable perspectives for investors navigating the evolving dynamics of the Indian market.

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