The liquidity gush has given a filip to the equity market deals which stands at USD 35 billion this calendar year so far compared to only USD 20 billion last year. The deals have been from different instruments like IPOs, rights issue, exit via block deals, fund raising through placement of shares, etc.
What lies ahead as the valuations currently are rich, volatility high in the market, and various global factors defining the liquidity flow from here on?
Easy money is behind us and we have to be bottom up in our approach, said Pankaj Tibrewal of Kotak Mahindra AMC in an interview to CNBC-TV18. Look at companies which have all the ingredients to move to the next orbit, he added.
Sunil Khaitan of Bank of America said that he does not expect the global liquidity to dry up. He further added that emerging markets will continue to see flows. “Discussions with global fund managers has always been that India is a place where they see growth and they will be able to capitalize on that as long as they are willing to stay invested,” he said.
Salil Pitale of Axis Capital said that given the amount of liquidity that was available in the marketplace, a lot of the financials have soaked in a lot of that liquidity. “Going ahead a lot of businesses which would be effectively businesses for the months and years ahead would be the ones which will be able to take in the capital,” he said. He further added that specialty chemicals, pharmaceutical APIs, etc. are the businesses which will attract and want to take some capital.