Preferential US tariffs or not, Indian economy needs fresh triggers, says Pankaj Murarka

Renaissance Investment Managers CEO and CIO Pankaj Murarka believes that while the outcome of US tariff talks is important, the Indian economy is already undergoing a reset and will need fresh triggers to drive growth.

“We have a downward economic reset at about 6.5% growth, and I don’t think this deal will move the needle. Either way, it’s good to have that deal so that it does not have an adverse impact on some of the sectors which have a higher share of exports to US,” he told CNBC-TV18.

He expects a pick-up in consumption from the second half, supported by recent tax cuts and rate reductions. “I think probably we have an injection of $25 billion into the economy, into the hands of the consumers.”
Murarka also discussed his sectoral bets. He said the recent workforce reduction at Tata Consultancy Services (TCS) reflects tight business conditions rather than any deep structural concern.

“When companies get into a tough demand environment, I think that’s an opportunity to buy and not panic and sell at this point of time, as long as you have a slightly more longer term view,” he said.

While competition for large deals has intensified and institutional tech spending in the US has slowed, he believes growth expectations for the sector are already modest and largely factored into stock prices.

In the banking sector, while results have been soft, he remains positively biased on banks. “I am still firmly of the opinion that we see a cyclical recovery in the domestic economy driven by consumption in the second half of the year, and which should drive growth in consumer loans.”