“The US economic system is clearly not in slowdown mode proper now,” Trivedi affirmed, underscoring the power of American spending. He famous that S&P 500 firms are projected to spend $4 trillion in 2025, encompassing capex, R&D, share buybacks, dividends, and M&A exercise. “That determine,” he added, “is greater than India’s present GDP.”
Much more putting is the anticipated 11% rise in company spending subsequent 12 months, displaying sustained earnings development throughout US corporates. “The dividend and share buybacks alone can be roughly $1.7 trillion — cash going straight into the financial institution accounts of shareholders and customers,” he stated, emphasizing the liquidity enhance driving the world’s largest economic system.
Addressing the frequent notion that the US fairness rally is pushed solely by the ‘Magnificent Seven’ tech giants, Trivedi countered that view. “That’s not the case. I’m solely referring to the highest 500 listed firms. There are one other 4,000 or so listed firms which aren’t captured on this $4 trillion quantity. The non-public firms aren’t captured both — for instance, OpenAI’s capex will not be a part of it. So, the quantity is quite a bit larger, doubtlessly one other trillion {dollars}.”
Turning to India, Trivedi highlighted a regarding pattern amongst international buyers. “Eight out of ten people who I met, or perhaps 9 out of ten, are clearly underweight India — by as a lot as 200 to 250 foundation factors vis-à-vis the MSCI Rising Market Index,” he revealed. India’s weightage has fallen sharply from 21% final 12 months to fifteen.7% now, reflecting practically $17 billion of FII promoting year-to-date.
When requested why FIIs have stayed away from India regardless of the long-term development story, Trivedi clarified: “Apparently, valuation was not that huge a deal — shock, shock — as a result of India has traditionally been costly. However once you marry excessive valuation with an earnings slowdown that has lasted 18 months, that’s the true drawback.”He added perspective on relative valuations: “India trades at about 22–23 instances one-year ahead earnings — the identical because the S&P 500. US buyers discover S&P 500 costly at 22 instances, whereas in India we are saying it’s not a giant deal.”Nonetheless, Trivedi maintained an optimistic tone a couple of turnaround. “If earnings don’t enhance, FIIs will proceed to remain away or promote. But when earnings enhance — which is the hope commerce now we have with the GST cuts and the final 5 weeks of explosive city gross sales — international buyers will come again to India.”
Amongst investor considerations, the way forward for Indian IT was a recurring theme. “Folks requested about the way forward for Indian IT given H-1B restrictions and the onslaught of AI,” Trivedi stated. “These shares have completed nothing in 5 years. I don’t see essentially any mild on the finish of the tunnel except they reinvent themselves. TCS saying an funding in knowledge centres is a good optimistic to pivot into an rising enterprise.”
There was additionally robust curiosity about India’s AI and energy ecosystem, as buyers appeared for methods to play the AI increase domestically. “There was lots of expectation on that,” he stated, “and lots of questions round energy era and transmission — essential to fuelling AI development.”
Waiting for FY26 and FY27, he sees trigger for optimism. “All people is speaking about a greater second half,” he stated. “That hope commerce is backed by anticipated price cuts, GST reductions, and the upcoming PSU pay hikes. Add all that collectively, and there’s a powerful case for earnings enchancment from the second half of this 12 months flowing into FY27.”
In essence, whereas Wall Avenue continues to shock with its resilience, Dalal Avenue’s revival — as Trivedi steered — hinges on one easy set off: earnings development.
