Global headwinds and high valuations driving Indian markets lower: Shreyash Devalkar
«There are some global factors as well that what is the trajectory of China's stimulus, so that has been one of the key factors, which in the last year, when some of the FIIs might have thought about China also as an investment class. But after that, again, China has corrected as well,» says Shreyash Devalkar, Axis Mutual Fund.
The Nifty is down more than 2000 points from its September highs. Do you expect more correction to come in or are the valuations now looking attractive? How are you reading into this fall in the markets? What could have been the reason? What could be the reason for the Nifty to consolidate at these levels? What are your views when it comes to the Indian markets?
Shreyash Devalkar: So, yes, we have seen that Indian market correcting, especially in last month, multiple factors has started affecting it. First and foremost, obviously, the valuations we have observed has been high in India. And when we say high, it is in the context that in across sectors, it is at least almost 30% to 200% higher than pre-COVID level as far as valuations are concerned, barring probably private sector banks, everywhere else this was observed and so that is actually the one point which has led to this correction.
Apart from that, when it comes to the growth as such, whatever we have observed, there is a deceleration in earning growth, which is observed in the recent results as well. The extent of which and how long it will, it will further lead to the earning cuts that is also on the back of investors mind, which
