scorecardresearchDebt to become an interesting asset class in 2023, says S Naren of ICICI Prudential AMC

Debt to become an interesting asset class in 2023, says S Naren of ICICI Prudential AMC

Updated: 04 Jan 2023, 09:46 AM IST
TL;DR.
Debt has been a less attractive asset class in the last few years.
Debt is likely to attract investors in 2023.

Debt is likely to attract investors in 2023.

S Naren, ED & CIO at ICICI Prudential AMC believes debt will be a great asset class for many investors in 2023.

In an interview with ET Now, Naren said, "...2023 will be a year when the debt will be a great asset class. For the last three years from the time Covid happened and interest rates were brought down in India to very low levels, debt was an uninteresting asset class. 2023 will be a year when debt becomes an interesting asset class for many investors."

Naren further said while the valuations of the Indian market are out of sync with the rest of the world, India has a great structural story.

"Whether you look at the structural story or at the valuations is a tough debate from an investor's point of view. No one knows which of the two will triumph, whether the valuations being high will create the problem or whether the structural story will work in favour," Naren told ET Now.

"That is a problem because only one of them can work in 2023. If we take a five-year horizon, the structural story will work, but in the shorter term, only one of them can work, which is a challenge," Naren added.

Naren said that value as a theme will not go out of fashion for the next 20 years or 30 years as well, however, at different points in time, different things will constitute value.

"Over 18 years, value has delivered and there will be periods of time like 2017-18, 2006, 2007, and 2008 when value failed and we will have these kinds of things. Value is something which will keep changing. For example, right now, pharma looks like a value," said Naren in the interview.

Disclaimer: This article is based on an ET Now interview. The views and recommendations given in this article are those of the analyst. These do not represent the views of MintGenie.

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Understanding value investing 
First Published: 04 Jan 2023, 09:46 AM IST