#WATCH | Mumbai, Maharashtra: On current GDP growth rate, MD and CEO, HDFC Securities, Dhiraj Relli says, "... Numbers that we are getting Q1 GDP 7.8% and all high-frequency indicators are suggesting that Indian markets have been robust. So to that extent, we don't need to worry about the macro environment in India, though we have inflationary pressures coming in from the higher crude prices, and last night itself we've seen crude prices going up by 5%..."

#WATCH | Mumbai, Maharashtra: On RBI Liquidity Interventions, MD and CEO, HDFC Securities, Dhiraj Relli says, "... As far as FCNR (Foreign Currency Non-Resident) is concerned, it is a tactical measure. This was done in 2013 and has been introduced again to arrest rupee depreciation. The current measure has ended one month earlier than the earlier deadline. My take is that this is just a tactical measure and can bring some stability to the rupee for the time being. Structurally, however, it depends on many other variables and not just FCNR flows, though FCNR flows have been better than anticipated and came in within two to two and a half months. This should provide some comfort to forex reserves and some stability to the rupee. But it is only tactical, not structural. Structurally, it would require much more action from the Indian government and the central bank to address the currency."

#WATCH | Mumbai, Maharashtra: On elevated global bond yields, MD and CEO, HDFC Securities, Dhiraj Relli says, "... I think higher bond yields would pose a challenge to the hypothesis that the RBI will go for a continual pause and will not raise interest rates. Markets have been working with the hypothesis that the RBI will go for a long-term pause and will not increase interest rates. However, with 10-year US Treasury yields going up to almost 4.8%, Japan at 3%, and yields rising across the world, there is significant concern around Indian bond yields as well. This could create inflationary pressure in Indian markets. If inflationary pressures rise, the RBI may also have to act and increase interest rates..."

#WATCH | Mumbai, Maharashtra: On NIFTY earnings growth facing margin pressures, MD and CEO, HDFC Securities, Dhiraj Relli says, "... In Indian capital markets, we have been witnessing price correction and time correction for over two years now. It is not just a matter of two months. There have been activities in the market that have been negative for quite some time, particularly foreign portfolio investors have been relentlessly selling in the Indian market, though domestic flows have remained robust. As far as valuations are concerned, current valuations are reasonable when we look at Nifty or Sensex stocks. However, when we look at the broader market, valuations are around 15% to 20% above normal levels. This is because earnings growth has been good in the mid- and small-cap segments, particularly in the last quarter, when Q1 earnings were strong. Investors are also looking to participate more in the broader market as Nifty and Sensex stocks have not been performing. In short, Nifty valuations are reasonable, whereas there is some froth and stretching in the mid- and small-cap..."

#WATCH | Mumbai, Maharashtra: On foreign capital flows, MD and CEO, HDFC Securities, Dhiraj Relli says, "... Unlike domestic liquidity, which is largely tied to the Indian market, Indian investors have limited options and largely have to invest in India. Foreign portfolio investors, however, have the world at play. They look at global markets and choose markets that offer better returns and a more favourable risk-reward profile. US markets have been doing well, and some other markets have also outperformed, while Indian markets have been strong performers in recent years. Foreign portfolio investors are therefore well within their right to choose the markets they want to invest in. Another factor is that the AI trade has been largely missing in India, which has affected flows into Indian growth stocks. The favourable risk-reward profile of US Treasuries also gives foreign investors comfort to remain invested in their home markets rather than face the risks of Indian currency depreciation. Currency depreciation has therefore been a major dampener for FPIs, adding to the pressure from relatively lacklustre Indian market performance and encouraging them to look at alternative markets..."