- Invest in asset classes you understand and be bullish during market downturns
- Focus on company stories, not only valuations, for long-term investment decisions
- Exercise caution in the IT sector; capital markets and banking show strong growth potential
“Buy what's unpopular.” That, according to Raamdeo Agrawal, chairman and co‑founder of Motilal Oswal Financial Services, is how you can play the long-term game. Speaking at an exclusive townhall on NDTV Profit, Agrawal laid out his core investing philosophy, touching on market cycles, sector opportunities, profit‑booking discipline and the disruptive potential of artificial intelligence.
At a time when markets remain volatile and investor sentiment cautious, here are five pieces of advice from Agrawal to the retail investor:
Advice to Retail Investors
“Always invest in the asset class that you understand,” Agrawal said when asked about diversification, cautioning investors against spreading money across unfamiliar instruments. “You have to be bullish when the markets are bad,” he added, stressing that conviction matters most during downturns.
“The story of the company should be right for investing,” Agrawal said, noting that valuation alone is insufficient without a strong business narrative.
“Think independently. If the market is going left, you should be going right,” he said, pointing to moments when fundamentally strong companies are priced cheaply due to negative sentiment.
“New investors need to learn that the market also goes down,” Agrawal said, calling volatility a necessary part of wealth creation.
On Sectors
“I am cautious on the IT sector,” Agrawal said, citing multiple headwinds and the need for deeper insight before deploying capital. “Capital market businesses are poised for exponential growth,” he said, flagging the sector as one of the more underappreciated opportunities.
“IT has headwinds; you need more insight to invest there,” he reiterated.
“You can make decent money from banking stocks in the next two to three years,” Agrawal said, highlighting improved balance sheets. “Indian banks' gross NPAs have never been lower,” he said, adding that “40–50% of private banks are already owned by foreign investors,” with data indicating “tremendous potential” in the segment.
On emerging platforms, he said, “You need a 10‑year horizon on quick commerce.”
Changing Market Picture
“India is getting wealthier at almost double the world's pace,” Agrawal said, arguing that structural growth supports long‑term investing.
“India will continue to remain expensive,” he cautioned, adding that the country should ideally have “two arbitrage machines,” with foreign institutional investors currently serving as the key bridge between Indian and global markets. “DII flows today are staggering — this wasn't the case five years ago,” he said.
On Booking Profits
“Follow the QGLP process,” Agrawal said, referring to quality, growth, longevity and price.
“Long‑term investing doesn't mean you don't book profits,” he added, projecting that India could soon have “50 crore investors.” For those with very short horizons, he said plainly, “I have no comment for investors with a nine‑to‑ten‑month view.”
On AI
“AI will do its own magic,” Agrawal said. “When software gets cheaper, demand is unlimited.” “IT companies will survive AI adoption for sure,” he added, while cautioning that “enterprise AI is not an easy nut to crack.” “Right now, the US is riding the AI wave very effectively,” Agrawal said.
ALSO READ: To Invest Or Not To Invest: Raamdeo Agrawal Weighs In On IT Sector Amidst AI Disruption
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