Stories
Indian Markets Nearing Peak Pain Despite FII Selling Says Jigar Mistry
- •Buoyant Capital Co-Founder Jigar Mistry believes Indian markets are approaching peak pain despite ongoing foreign institutional investor selling and global interest rate concerns.
- •Short-term market pressure is driven by rising US Treasury rates, crude and external balance concerns, and uncertainty surrounding domestic fund flows.
- •Mistry notes that India's current macroeconomic position is significantly stronger than during the fragile 2013 period, dismissing knee-jerk historical comparisons.
- •Earnings and EPS growth remain much better predictors of long-term share prices than flow-driven narratives, leading Buoyant Capital to favor large caps over small caps.
Key Questions Answered
Jigar Mistry attributes the recent market pressure to three main factors: rising US Treasury rates, external-balance and crude concerns, and uncertainty surrounding domestic market flows. These elements create short-term volatility without indicating a deep long-term structural problem for India's economy.
Mistry states that India's present economic fundamentals, external balances, and import cover are substantially stronger than they were during the 2013 fragile-five crisis. Furthermore, he notes that other emerging economies are generally in a worse position relative to India today.
Despite strong retail inflows into smaller companies, Mistry emphasizes that long-term share prices are driven more reliably by earnings and EPS growth. Historical performance showed small caps underperforming large caps despite massive retail investments, prompting Buoyant Capital to favor larger companies.
