Ajay Srinivasan was spearheading Prudential ICICI Mutual Fund, the country's largest private sector mutual fund for almost three years between February 1998 and January 2001.
In this period, the fund increased its assets from Rs 140 crore to Rs 4,600 crore, making it the number one fund in the private sector and second only to the public sector behemoth, the Unit Trust of India. Based in Hong Kong now, Srinivasan, an IIM Ahmedabad alumnus, is responsible for Prudential's businesses across Asia. Srinivasan shared his views on the mutual fund business and Indian markets during his visit to India last week.
What is your view of the state of the equity markets right now?
Undoubtedly, equity markets have been pretty choppy of late. There are many factors at play here: the Iraq war, the downturn in global economies, the threat of deflation and now the Severe Acute Respiratory Syndrome (SARS) scare.
All these are bound to have an impact on the markets. One thing we notice across the world is that, if we look at the dividend yields in equities of good companies, we find that they are more than the yields on risk-free assets such as government securities.
This means that people are not willing to buy into any growth in the future. They, in fact, believe that that perhaps there is no growth in the future
