Newsletter June, 2025

After a long period of low volatility and shallow drawdowns (FY21-Sep’24), in the last few months, Indian markets have been witnessing increased volatility and drawdowns. Decadal macro trends, which have been conducive to economic growth and equities, such as globalisation and low interest rates, now appear to be at risk. Indian markets are beset by a confluence of factors, including persistent high valuations (1), tepid earnings growth (2), and a base of a multi-year, broad-based bull market (3), which signals a challenging environment for Indian markets in the medium term. During such challenging periods, there is invariably a shift towards timeless investment principles and a disciplined long-term investing style. We believe that our Ambit Asset Management investing framework, based on long-term investment principles that focus on quality, a business ownership mindset, and capital preservation, is likely to stand out positively in this phase. In this newsletter, we discuss the five key factors 1) Mindset – Simplicity in Complexity, 2) Process – Focus on the most important variable, 3) Approach – Picking up Nuggets of Gold, 4) Risk Positioning – Focus on Capital Protection and 5) Behavioral – Conviction cannot be borrowed, which differentiates Ambit Asset Management Portfolios.