"Earnings growth is likely to be around 15 per cent in next 12-18 months. Market index will go upward if that happens," Joint Managing Director Ramdeo Aggarwal said in a conference here organised by ICICI Prudential MF.
On the importance of equities as an asset class, he said it's the only investment which can beat inflation.
Similarly, Chief Investment Officer (CIO) of ICICI Prudential MF, S Naren said investors are highly under- invested in equities as of now and they should now look at putting money into equities for higher returns.
He also noted that worst economic period was now behind us and the falling trend in GDP growth, investment growth and corporate earnings are now likely to be reversed.
Making a strong case for investing in equities, Naren said market cap to GDP was very cheap and valuations are at attractive levels.
He, however, noted that outcome of general election remained a key trigger for the market movement.
"A weak coalition government post elections and government's expenditure reduction pose risk to growth in the near-term," Naren said.
He also said that fixed income products in the mutual fund space also provide sound investment opportunities.