Baroda BNP Paribas MF's Suresh Soni on markets and more

Q1: Can you give us your outlook for the markets currently? How long do you think the volatility may continue and do you think the Indian markets are still overvalued?
Ans:
>After a sustained rise, equity markets continue to move sideways from November last year
>Markets witnessed FII outflows of about $30 billion
>Despite geopolitical uncertainties, rising commodity prices and Fed rate hike, markets have held relatively well
>Valuations at an average of the past five years now
>In the near term, sideways movement will continue in markets
 
 
Q2: The merger has come into effect after two years. So what do you see as the strengths of this merged entity and what vision do you have for it?
Ans:
>The merger brings along the strengths of two large institutions that are backing it
>The AMC will benefit from the institutions’ strength in asset management, risk management and investment processes
>This is, in a way, a reset point in the life of the asset management company
 
Q3: Post the merger, what does your new product pipeline look like? Where are you seeing opportunities ahead?
Ans:
>Following the merger, the existing product pipeline becomes stronger
>Present product line: 28 schemes across equity, fixed income and hybrid category
>Aims to bridge product gaps in the next six to twelve months
 
Q4: Are you planning to enter the index funds space?
Ans:
>Passive market has seen disproportionate growth
>Witnessed a growing trend in favour of passive funds over the last few years
> Passive market is an area which the fund is watching with interest
 
Q5: Several new players are entering the space. Is there scope for everyone to grow in this asset management industry in India?
And:
>The differentiator for Baroda BNP Paribas Mutual Fund is the institutional backing of Baroda Asset Management India and BNP Paribas Asset Management India
>Bank of Baroda has been around in India now for more than 110 years
>BNP Paribas Bank has been around in India for more than 160 years
>However, Baroda BNP Paribas Mutual Fund will operate with the energy of a start-up
>Mutual funds are still very under-penetrated
>Mutual funds are owned by less than 2% of the population of this country
>Number of unique investors in mutual funds would be between two and a half to three crores
>There is scope for everybody to grow in the mutual funds market
 
Q6: Do you foresee further consolidation in this industry?
Ans:
>This is a business of scale
>This is an industry that lends itself well for consolidation as well as growth
> In the current setting, there will be more growth acquisitions in the industry
 

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