India's Growth Story Intact, Says Anand Rathi As He Dismisses FII Outflow Worries

Anand Rathi, the founder and chairman of Anand Rathi Group, is upbeat about India's economic expansion and the potential of the stock market despite worries about market volatility.

Rathi in an interview with NDTV Profit on Diwali, said he was confident in the economy's 7% growth rate, falling interest rates, and decreasing inflation. Even though there may be some volatility, he thinks these elements will help the market go in a positive direction.

Rathi pointed to the growing number of local investors and the allure of the Indian economy, and disregarded worries that FIIs would withdraw from the Indian market. "Local money is increasing at a fast pace... Retail investors and wealthy investors have realised it's a long-term view," he stated.

On consumption and economic growth, Rathi acknowledged potential slowdowns but emphasised India's resilience. "The Indian economy is today the world's best economy... We are an island out of the entire world," he stated.

Rathi's optimism is rooted in:

Economic growth: 7% GDP growth rate

Declining inflation and interest rates

Increasing local investor participation

India's relative economic resilience

When asked about the wealth management industry, Rathi highlighted its growth potential. "People are getting educated about asset allocation... Equity as an asset class is today the best compared to gold and real estate," he said.

As for concerns over market volatility, Rathi differentiated between traders and long-term investors. "Traders need to be worried, but long-term investors should focus on the bigger picture," he advised.

Rathi's positive outlook is also fueled by:

Demographic dividend: A young, working population driving growth

Digitalisation: Increased financial inclusion and ease of investing

Government initiatives: Reforms and policies supporting economic growth

The wealth management industry is poised for growth, driven by:

Increased financial literacy

Rising disposable incomes

Demand for professional investment advice

Anand Rathi's expertise and insights point towards the importance of a long-term perspective in investing. By focusing on India's fundamental strengths and growth potential, investors can navigate market fluctuations with confidence.