In this series by Value Research Ved Prakash Chaturvedi of Tata AMC, Mihir Vora of HSBC MF, Sandip Sabharwal of JM Financial, Kenneth Andrade of Standard Chartered MF, Devendra Nevgi of Quantum MF and Sunil Singhania of Reliance MF, Sandeep Kothari of Fidelity MF, Aniket Inamdar of Deutsche Asset Management, Anoop Bhaskar of UTI Mutual Fund, Nilesh Shah of ICICI Prudential AMC, Sanjay Sinha of SBI MF and Sivasubramanian KN of Franklin Templeton give their take on current market conditions, if the bull run is over and how they are coping with the situation.

Ved Prakash Chaturvedi
Managing Director, TATA AMC

Is the bull run over?
In a bull market it is easy to forget about the risks inherent in high valuations and when markets come down it is difficult to believe in the long term potential of individual companies. Over a period of time, equity markets reflect the fundamental earnings growth of companies. However, in situations like the one at present, equity markets may reflect the then prevalent local and global sentiment. In the near future, the market is likely to reflect the global uncertainties and be in a trading band. However, sharp declines will present value investors with opportunities.

Most analysts feel that the Indian economic growth trajectory of average 6 per cent plus GDP growth rates should last over the next two decades. This growth is based on strong structural fundamental factors including young and skilled demographics, well structured and strong financial system, high quality and well managed companies and a democratic tradition which drives meritocracy in the country. Given the structural long term growth potential of Indian GDP, India continues to be a long term positive equity market.

What's the reason for this slump?
The current situation in the market has its origins in the bursting of the housing and credit bubble in the US and the consequent concerns on global economic growth.

Consequently, global equity markets have seen sharp corrections and this is getting reflected in our markets. There has also been some pullout of FII money. Thus, in the near term, the market will reflect sentiment and concern but once this passes, equity prices will reflect the economic realities of a positively inclined economic growth curve.

How have you responded to the turmoil?
We continue to buy into high quality companies with a long term earnings growth story. In volatile times, markets will move towards companies where earnings growth visibility is relatively certain and genuine. We have been orienting our portfolios more towards such companies.