Speaking at Moneycontrol’s Global Wealth Summit, Vishal Mahadevia, Managing Director and Head of Asia Private Equity at Warburg Pincus, dismissed the notion of a loss of faith in India.
“There is no disenchantment. If you look at private capital, both private equity and real assets, there is a huge amount of interest in India,” he said. However, he pointed to valuations as a key reason for the foreign institutional investor (FII) exodus. “People are booking profits and reassessing where to deploy capital next,” he noted, adding that investors are weighing the risk-reward trade-off compared to other global opportunities.
Florian Neto, Head of Investments Asia at Amundi, provided a broader perspective, noting that recent FII outflows should be viewed in the context of the massive inflows into India over the last five years. “India has been a structural story in global portfolios,” he explained. While profit-taking and global market conditions contributed to recent outflows, Neto reaffirmed India’s appeal. “Yes, valuations are high, but this is the price you pay for growth. India’s return on equity exceeds 15%, which is rare among large economies.”
Neto downplayed concerns over economic growth, saying that India’s temporary slowdown was expected due to fiscal consolidation and a cautious stance by the Reserve Bank of India (RBI) to manage inflation. “We expect 6.5% GDP growth this year, and this is the new potential growth over the next five years,” he said, adding that Amundi remains committed to India and is tactically re-weighting its overweight position in Indian equities.
Meanwhile, Ankur Gupta, Head of Asia Pacific & Middle East at Brookfield’s Real Estate Group, acknowledged market volatility but argued that India remains one of the most attractive investment destinations. “India will never have less volatility, but this is probably the best investment environment we’ve had,” he stated.
Gupta emphasised that the real estate sector, along with infrastructure and manufacturing, will be key drivers of India’s next phase of economic expansion. “Private capital, the real capital formation that fuels economic growth, hasn’t stopped in India,” he said, urging investors to focus on the long-term trajectory rather than short-term stock market fluctuations.
While foreign outflows continue to weigh on India’s equity markets in the short term, investors see the current correction as part of a broader cyclical adjustment rather than a structural concern. With India’s economy stabilising, its earnings growth expectations resetting, and strong interest in private markets, global investors remain bullish on India’s long-term potential.
Watch the below video for the entire discussion
