The Indian stock markets are not so volatile today thanks to Indian domestic investors, whose investments—mainly through mutual funds—are providing stability to the markets, says Navneet Munot, MD & CEO, HDFC Asset Management Company Ltd. 

He was speaking here on Monday at a function organised by the NGO, United Way of Chennai. 

A chart he showed, reproduced here, illustrated the point. ‘Systematic Investment Plan’ (SIP) inflows into mutual funds rose from ₹4,000 crore as of end of March 2017 to ₹19,000 crore at the end of February 2024. 

This is despite the fact that less than 5 per cent of Indian household savings are invested in equity—which also indicates that there is a lot of room to grow, he said. 

Munot said that apart from manufacturing, tourism would provide a ‘transformational’ boost to the economy, especially after the big improvements in infrastructure. In this context, he had a different take on the name of the movie, RRR, saying that could well stand for ‘roads, railways and renewables’ in India. 

Munot said that China might be ahead of India in many respects, but not in stock markets. In 2004, when China and India had roughly the same level of per capita income, the Shanghai Index was 1,500 and the Sensex 5,000; today, they are 3,000 and 70,000 respectively, he said. 

Another chart he displayed showed that between 2013 and 2023, 4,061 companies came out with initial public offerings. In these years, companies raised ₹10,06,000 crore through IPOs, FPO, OFS and QIP routes. 

He said the average oversubscription in an IPO is about a hundred times and the average gain on listing is about 40 per cent. IPO may therefore be expanded as ‘instant profit opportunity’, Munot said. 

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