Investor Message - FY25 Q1

The commencement of a new financial year holds immense importance for economies, businesses and individuals alike. It is a time to assess the year gone by and plan for the year ahead. This financial year holds special meaning, and I am delighted to write to you as we embark on this new year ahead of us. This is a year, when we at ABSLAMC celebrate a momentous milestone – our 30th year. Three decades of unwavering commitment, hardwork and customer centricity have shaped our journey, and we are deeply grateful for the invaluable support and trust that you have extended to us over the years.

Stepping into the new financial year, we find ourselves amidst a global landscape marked by significant events, including elections in over 80 nations and territories, representing more than half of the world’s population.

From a global macroeconomic perspective, there are expectations of rate cuts by Central bankers, including the Federal Reserve in the coming months. A change in the unemployment rates may dictate further changes in the rates in the United States. Our expectations of a soft landing prevail.

The Indian economy continues to demonstrate resilience, with a healthy growth rate, stable inflation and rising forex reserves. India's equity market has consistently outperformed global counterparts, offering investors robust opportunities for growth. Periodic consolidation phases have followed significant rallies in the past, with a potential post-election consolidation looming. One should not be concerned with the recent market volatility which largely stemmed from regulatory and industry initiatives on small and midcap stocks, which are aimed at enabling investors to make informed decisions. India’s structural drivers and economic fundamentals remain strong and investors should continue to take part in its growth potential. The SIP route in mutual funds continue to be a relevant tool to take exposure in Indian markets and participate in its growth story.

It is encouraging to see the financialization of savings in India with more and more Indians making use of investment products to make their money work. The mutual fund industry has continued to witness strong inflows and increased investor participation. Large-cap and Flexi-cap funds continue to remain the preferred choice for investors seeking growth and stability. Investors seeking diversification may be drawn to Multi-Asset allocation funds, which spread investments across equities, fixed income, and commodities. Strategic asset allocation will continue to remain key to navigating market movements and dealing with any short-term market fluctuations.

Together, let us embrace the opportunities that lie ahead of us in the new financial year. Happy investing!

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Regards,
A. Balasubramanian