'People who have made money': Motilal Oswal decodes art of creating wealth 

Market veteran Motilal Oswal, who has over four decades of experience at Dalal Street, said market volatility is increasing day by day, but he is not worried. The Group MD and CEO at MOFSL said despite the recent market fall, the one-year returns for benchmark stock indices are still positive. In his four-decade-long career, Oswal said he has seen instances when the market tumbled 20-25 per cent, and for no good reason. 

The fundamentals of the market and the economy remain strong, he told the audience at BT Vucanomics 2025 -- Thriving in Turmoil. The session "The Art of Wealth Creation" was moderated by Siddharth Zarabi, Editor, Business Today. 

Oswal said every next decade is going to be far more volatile than what it used to be. The volatility is rising every day, he said adding that it is the nature of the market to go through ups and downs. 

On the recent market correction, Oswal said he is not much worried. He called the fall as consolidation and said the market just took a breather. Oswal said he sees 10-15 per cent earnings growth for India Inc  in the next couple of years. 

Oswal noted that one of the major reasons for the recent correction was the fact that the earnings has been muted of late. He noted that between 2020 and 2024, Nifty earnings grew at 26 per cent compounded annually. This growth has fallen to 4-5 per cent, he said.

Oswal recalled how he started his broking business when the Sensex was at 600. The BSE barometer has gone up to 77,000-old level from a mere 600 level in 37 years, he told. 

"I never thought ...when we started the market size was very small, the index was today, it is about 80,000-77,000. It was 600. From that 600 to 86,000 in 37 years, you can see the magnitude and the size of the market and the opportunities that lies," Oswal said. 

Can a retail investor win against technology? Oswal said one needs to understand who a small investor in market is: an investor or speculative trader. He said different kinds of customers come to the stock market with very different needs. He said it is important for a brokerage like his to understand the profile of small investors. 

Oswal said when his brokerage looked at the data, he found that most of new investors either come to the IPO market or come through the SIP route. He said the Demat accounts have risen four times in the past five years.  

It is only because of the rising trend in the market, financial savings, technological advancement and the mobility, he said. 

"But if have to look at the people who have made money, it is only the people who have invested into either mutual funds or stocks for long term, which is, unfortunately, a very small minority of the people. Most of the people actually have gone into speculating, part of the shorter, investing, short-term trading, and that's where the people go," Oswal said.  

Oswal said people have become more traders and that's where the bigger problem is today. 
That said, Oswal believes the market is becoming much more mature -- the level of education and awareness has improved. 

He noted that huge amount of money is coming through SIP which, he believes, is long-term money. In the past four years, the monthly SIP inflows have jumped to Rs 25,000 crore a month from Rs 4,000 crore a month. Oswal called it a very healthy practice.

Oswal said in the next 5-10 years, India needs an army of well-trained people to make sure that the right amount on right advice is given to the right people, understanding their profile well. He gave an example of his company and said it takes a lot of time and employees have to go through the cycle for them to really understand the impact of events on the market. 

"If you see the last five to six years, 80 per cent of investors are completely new and maybe 75 per cent employees. They will be who have not seen the really bad cycle, except Covid-19, which was just for few months," Oswal said.