The long-term bull cycle in India is intact

12 mutual fund managers give their take on the stock markets, the current bouts of volatility and how they are responding to tackle the situation.

In the second part of this series by Value Research Sandeep Kothari of Fidelity MF, Aniket Inamdar of Deutsche Asset Management, Anoop Bhaskar of UTI Mutual Fund, Nilesh Shah of ICICI Prudential AMC, Sanjay Sinha of SBI MF and Sivasubramanian KN of Franklin Templeton give their take on current market conditions, if the bull run is over and how they are coping with the situation.

Sandeep KothariFund Manager, Fidelity MF
What was the reason for this slump?The genesis of the correction is in the global credit crisis and the resulting uncertainty in the global economic environment which has reined in investors' risk appetite. In keeping with this, local sentiment too turned nervous. This, coupled with high valuations, led to the correction.
Is the bull run over?I believe that the long-term bull cycle in India is intact. In the short term, price corrections will occur whenever you have a run-up in valuations and expectations. The correction that we have been seeing over the last few weeks has come after four to five years of an uninterrupted bull run and valuations were at the higher end. Now we could see valuation support emerging. With valuations now looking reasonable, the market will be looking out for any impact on earnings.
Has the India growth story run out of steam?Whether it takes five or seven years, there's little doubt that India's economy will go from a trillion to two trillion dollars. And that will require significant levels of capital formation. So, India's long term structural growth story is intact and though growth is moderating, it remains robust. The growth drivers too are firmly in place -- favourable demographics, rising consumption and continued investment in infrastructure.
How have you responded to the turmoil?As an active money manager, we are always looking at ways to manage our portfolios to deliver risk-adjusted returns. As the market has moved away from momentum, bottom-up stock picking has become even more critical. We are focused on stocks where valuations are starting to look attractive and these are companies across sectors with long-term scalability, execution capability and near-term earnings visibility.