India should do extremely well in the next two decades, says market guru Prashant Jain

“I think the economic outlook of India is probably the best that one has seen in the last many decades and that’s what makes one optimistic over the long term,” says market veteran Prashant Jain.

In the key economic zones of the world, whether it is the U.S, Europe, China, or Japan, most are experiencing negative growth in the working-age population. It is only in India, where the working-age population continues to grow and, the situation will remain the same for the next two to three decades. So, anything that can be done remotely has a chance of being outsourced or offshore to India. So, this should create a fairly large number of jobs in India, the market expert said. 

In the next decade, India should be able to grow its share of manufacturing exports faster in comparison to the last 10 years. Manufacturing is a much bigger opportunity for India and every half per cent improvement in the market share is almost 3 to 4 per cent of India's GDP. So, “I think this has the prospects of increasing India's growth rates may be to 7 or 8 per cent over next one or two decades,” Jain, Director & Fund Manager, 3P Investment Managers, said in an exclusive conversation with Udayan Mukherjee, global business editor, Business Today TV.

On PSU banks, Jain, who earlier helmed affairs at HDFC AMC said, "I don't think we should paint all the PSUs in one brush and, I've been careful to invest only in sustainable businesses both in the private and public sector.” He further explained that the outlook for earnings growth in banking is quite strong because credit growth is good, balance sheets are clean, and provisioning costs are likely to be low. 

Sharing his views on new-age digital companies, Jain sounded a note of caution, he said, “I think these are very diverse business models and, in many cases, even the route to profitability is yet to get established. So, I for most of my career have avoided business models that are not well established.” The market guru further said that by the time these models come to the public, if they are not established, it's very hard to value them and the risk-reward is not favorable.

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