The India growth story remains intact and recession in certain parts of the world is unlikely to seep into the country; on the contrary this would be a golden decade for India, according to a top official at JM Financial.
However, with global inflation, rate hikes and readjusting of portfolios, there could be periods of high volatility in markets, Sonia Dasgupta, MD & CEO (investment banking) at JM Financial, told FE in an interaction.
“We are positive on the India growth story as we have got close to $9 billion FDI inflows. So far, we have not seen any looming signs of recession in India and we are very confident that India will remain a great magnet for a lot of inflows. The whole impetus of large multinationals looking at India for manufacturing and the China Plus One policy is going to help,” Dasgupta said.
Given the capability that India has, the purchasing power due to its demographics, young population, talent pool, and the spends for infrastructure, education and healthcare, this would be a “golden decade” for India, she said. Going forward, sectors such as manufacturing, financial services (insurances, mortgages), auto components, defence and pharmaceuticals would witness increased investments.
On the rise in exits by private equity firms, Dasgupta said most of these took place on completion of full lifecycles of investments by PE firms, which helps in investors getting more confident about a market with depth like India. And hence the same names are keenly looking at investing in India, she said.
The PEs are interested in sectors such as healthcare, consumer, technology, financial services and tech-enabled services.
Dasgupta said the M&A deal pipeline for FY24 looks strong. A number of initial public offering (IPO) deals that did not happen in the last financial year will spill over into this year, and the number of IPOs is also expected to rise in FY24.
The reset in the global economic scenario has definitely impacted the amounts PE funds have been able to raise recently from their limited partners, she said. This has naturally made investors a bit cautious on valuations they are willing to pay when they invest, unlike the mood of investing that prevailed in FY22, which seemed to have been driven by the fear of missing out on opportunities, she added.
JM Financial, which is celebrating its 50th year of being in business, will continue to focus on spaces where its clients would invest, Dasgupta said. These include renewables, branded products (especially food), healthcare, technology, financial services and affordable housing.