“They are coming to the end of that real estate solving, and if that happens, then you see a further upside. But I would say, in a relative sense, yes, China looks a lot more attractive than any other emerging market,” he said.
In India, Laxminarayan sees largecap stocks as a good investment choice. However, small and midcap stocks need some correction, particularly in terms of liquidity.
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“As a house, we have been very favourable towards the largecaps. And now, especially with the correction, the largecaps are looking even better,” he said.
Laxminarayan also commented on the recent correction in the US stock markets. He cautioned that it should not be seen as a positive signal for global markets.Also Read | Kotak’s Nilesh Shah: There is a ‘quit emerging markets’ movement underway
“If the US, or the global markets, driven by the US, starts to drop a bit more, that sentiment will sort of pervade all other markets too. So, one should be cautious about how one plays this,” he noted.
On interest rates, he was sceptical about the likelihood of significant rate cuts from the US Federal Reserve, citing inflation risks and potential policy mistakes.
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“Betting too much on rate cuts is possibly not the ideal thing to do, which also means that the dollar differential or the rate differential, somewhere along the line, is going to start again, playing in favour of the dollar. So, while you are seeing some weakness now, I would not bet on very prolonged weakness in the dollar,” he said.
For the entire interview, watch the accompanying video
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First Published: Mar 10, 2025 11:49 am IS
