US President Donald Trump on April 9 announced a 90-day pause on his sweeping tariffs on all countries except China. Pranab Haridasan, managing director (MD) and chief executive officer (CEO), Axis Securities, told Devanshu Singla in an email interview that Trump’s announcement provides temporary relief, but does not end the uncertainty. Edited excerpts:
How do you view the 90-day pause on US tariffs and its impact on Indian markets?
The 90-day moratorium on new US retaliatory tariffs provides temporary relief, but it does not eliminate uncertainty. The 10 percent tariffs are still in place and China’s retaliatory action shows we are in no way of a solution. It may not have a direct impact on India, but we are seeing its indirect effects. Export-intensive sectors like IT (information technology), pharma and auto will have to proceed cautiously as if global growth slows down further, there could be some pressure on their projections, margins and deal wins. However, India may get long-term benefits from the China Plus One story. In view of this, domestic centric sectors like consumption, banks and infrastructure are better protected. We remain neutral to underweight on IT at least in the near term until the fog on estimates clears.
How are foreign institutional investors (FIIs) reacting to India’s post-tariff situation? Will the investment trend change in FY26?
FY26 may be more positive for foreign investment. Measures like reduction in cash reserve ratio by the Reserve Bank of India, consumption-focused budget and accommodative stance globally are positive. Improved earnings clarity could bring FIIs back, especially towards largecaps and fundamentally strong stocks.
What was the most important factor in terms of investment in FY25 and what is your outlook for FY26?
Discipline and asset allocation remain more important than ever in FY2025. Amidst so much global turmoil, those who stuck to the long-term process and avoided the noise have performed well. This further reinforced the need for goal-based investing, rebalancing and staying invested through cycles.
My outlook for India in FY26 is positive. Large cap shares are available at more reasonable prices compared to mid and small cap shares. Domestic sectors such as banks, industrials and capital goods are in a good position due to their strong balance sheets, policy stimulus and revival in capital expenditure. On the other hand, export-oriented sectors like specialty chemicals, auto accessories and precision manufacturing may surprise as global trade stabilizes and China Plus One gains momentum. These less favored areas can become dark horses.
What is your view on the outlook of the broking industry in FY2026?
The outlook is more positive than six months ago. Compliance costs related to F&O norms, AMC charges of depository participants and transaction fees led to decline in retail participation and overall volumes also declined. However, the worst is over and we are seeing signs of normalcy. As participants adjust and confidence builds again, there is likely to be a lasting improvement in volume. Well-capitalized brokers equipped with technology, compliance infrastructure and client-centric platforms are best positioned to capture share as the storm abates. Even if there isn’t explosive growth, there could be consolidation and a durable improvement in volumes for individual brokers in FY26.
First Published – April 23, 2025 | 10:57 PM IST
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