Foreign outflows show currency concerns, not a negative India fundamentals: Aditya Birla Sun Life AMC's Harish Krishnan

Subscribe to enjoy similar stories. The budget is unlikely to cause a meaningful shift in the assessment of equities from a medium-term perspective, and so investors should look at markets through a fresh lens to identify which newer themes could emerge as winners, said Harish Krishnan, chief investment officer - Equity at Aditya Birla Sun Life AMC Ltd. After the budget classified tax on buybacks as capital gains, some relief for buybacks may help return excess capital in a few mature companies, which can then be recycled into newer capital-intensive opportunities, said Krishnan.

Some consumer staples, even though they have higher price-to-sales ratios, are generating significant cash flows and could be a better bet than recent winners such as EMS (Electronics Manufacturing Services) or hospital stocks, he added. Edited excerpts: In an environment of elevated global uncertainties, the Indian government continued its path of prudence—resorting to realism rather than rhetoric. Unlike most major economies, which have continued to expand their unconventional fiscal policies (high fiscal deficits sustained for much longer, tariff uncertainties, etc.), India has chosen to maintain its glide path toward fiscal discipline.

There has, however, been a shift in its priorities. Post-covid, from FY21 to FY24, the Union government went on a massive overdrive on supply-side initiatives—namely, the infrastructure and investment themes. Capital expenditure growth averaged about 31% (FY21-24), however, since last year for FY25-27 (BE), this has now come down to about 10% on average.