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Dennis argues that India’s recent GDP growth slowdown may not be as severe as it appears and expects some stabilisation or even a slight rebound. Growth forecast for the next year, ranging between 6.5% and 6.8%, is still the highest among major emerging markets.
Several macroeconomic tailwinds could support this recovery. The Reserve Bank of India (RBI) has begun cutting interest rates, which could provide a boost to economic activity. Tax cuts introduced in the Union Budget add another layer of policy support.
oil prices could also play a crucial role. Dennis believes that a potential ceasefire in the Russia-Ukraine war could lead to the lifting of sanctions on Russia, increasing oil supply and pushing crude prices lower. “I think oil is going to stay quite soft over the next several months, and that will obviously be helpful for Indian inflation,” he noted.
Read Here | Kotak’s Sanjeev Prasad still sees froth in market, expects 15% FY26 Nifty growthIndia’s markets have lagged behind North America and even China, which has seen a surge due to factors like AI advancements and policy moves by the Chinese government. However, Dennis believes this trend won’t last. “I do believe when that starts to happen, India will start to get a bit again from FII investors,” he said.
While India remains an expensive market, Dennis expects it to gradually close the performance gap with other emerging markets in the coming months. With economic fundamentals still strong and key macroeconomic factors shifting in its favour, Indian equities may be entering a phase of renewed investor interest.
Dennis points out that India’s exports to the US are relatively limited, making the impact of US tariffs also less significant.
Also Read | ‘Nifty could fall another 5-6%’: Vineet Sambre’s advice on making the most of it
(Edited by : Shweta Mungre)
