Anurag Singh, Managing Partner at Ansid Capital, recommends focusing on private sector banks and selectively investing in healthcare. He describes the IT sector as ‘expensive’ in terms of valuations.

He also suggests allocating 20-30% to bonds for those timing the market, while advocating steady investments in Nifty companies for consistent long-term value.

Anurag Singh highlights the undervaluation of stocks like HDFC Bank, which still hold value despite reduced market interest.

He cautions against investing outside the Nifty 50, as broader market segments are unlikely to offer significant returns in 2025, emphasising a preference for a selective, rather than bottom-up, investment approach in India.

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Nifty’s overall valuation is slightly below its long-term average. There is no froth or overvaluation. It is exactly where it should be, a tad below rather, he explained.

However, he acknowledges the influence of foreign institutional investors (FIIs) on Nifty, especially in sectors like consumers, technology, and banking.

On macroeconomic factors, such as the rupee’s exchange rate and its implications for FIIs, he believes that the challenge is exactly after the rupee started to tumble a little bit. The rupee will have to find its level. This overvaluation could deter FIIs from committing new funds to the Indian market.

Also Read | Indian market needs 5-6% more correction for better valuations: Andrew Holland

India’s nominal gross domestic product (GDP) growth of 10% over the past decade, while reasonable, falls short of meeting the aspirations of its talented workforce, raising concerns about opportunities for the youth.

China’s vast excess capacity in sectors like Electric Vehicles (EVs) and green energy challenges India’s investment momentum, as global players favour imports from China. Bureaucratic hurdles and slower progress impede India’s ability to keep pace with the rapidly evolving global economy.

For the full interview, watch the accompanying video

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