‘This correction is a good opportunity to pick quality stocks at a discount rather than panic’

The Indian markets have corrected about 15 per cent from their highs in the past six months, a much-needed breather after a strong post-Covid rally. With GDP expected to grow at 6.7-7 per cent, corporate earnings recovering and valuations becoming more attractive, the long-term economic outlook remains strong, said Manish Goel, Founder-Director, Equentis Wealth Advisory Services. Edited Excerpts:

What is your current outlook on stock markets given the macroeconomic trends and global uncertainties? Are we seeing a bear grip on the markets?

The Indian markets have corrected about 15 per cent from their highs in the past six months, a much-needed breather after a strong post-Covid rally. While many blame Trump’s tariff war and record FII selling, we believe these are not the real reasons. India’s trade exposure to the US is limited, and lower crude prices due to the trade war have actually benefited us. FII selling is happening because US markets offer better short-term returns, but domestic investors have balanced this out by investing even more.

The real reason for the slowdown is domestic — after Covid, people invested more in stocks rather than saving in banks, leading to fewer loans, lower consumer spending and weaker corporate profits, slowing down economic growth. However, the long-term outlook remains strong, with GDP expected to grow at 6.7-7 per cent, corporate earnings recovering and valuations becoming more attractive. For smart investors, this correction is a good opportunity to pick quality stocks at a discount rather than panic.

SEBI has allowed specialised investment funds (SIFs), do you have any plans to launch such product? Will SIF impact PMS like you?

SIFs offer a middle ground between Portfolio Management Services (PMS) and Mutual Funds. They give HNIs more flexibility, better risk management and personalised investment options while ensuring regulatory safeguards. With financial asset penetration still low in India, SIFs can help grow the investment market. While they bring more competition for PMS providers, they also encourage innovation by pushing PMS players to enhance their services, offer smarter strategies and improve client support. In the end, this benefits both investors and the industry.

What is your advice for investors looking to build a retirement corpus in the current market?

Your retirement investment strategy should depend on how much time you have left before retiring.

If you have 15+ years to go, then think of this market dip as a chance to buy good stocks and mutual funds at a discount. Keep your SIPs running and use this time to benefit from averaging. Also, make sure to diversify your investments, so you are not relying on just one asset class.

If you have less than 10 years left, now is the time to focus on protecting what you have built. Slowly reduce your equity exposure and shift towards safer options like bonds or annuities that offer steady returns.

No matter how close you are to retirement, avoid panic selling and do not withdraw from your retirement savings unless absolutely necessary.

Do you see the Budgetary I-T relief fuelling retail investments in equity markets?

The recently-disclosed GDP numbers indicate that tax relief measures and RBI’s rate cuts have played a crucial role in India’s economic recovery by boosting private consumption and investments. Lower income-tax burdens and reduced interest rates have put more money in the hands of consumers, encouraging higher spending on goods and services, pushing private consumption to its highest level in nine quarters.

With GDP growth rebounding from 5.6 per cent in Q2 to 6.2 per cent in Q3 FY25, it appears the economy has bottomed out, driven largely by increased government and private consumption. The CSO forecasts a potential 7.6 per cent expansion in Q4 FY24. Overall, the GDP trajectory is on an upward path, signalling improving demand and strengthening economic recovery.