Manish Chokhani on global reset, AI mania and India’s market puzzle

The world is witnessing a major reset in global capital flows, driven by AI mania, shifting geopolitics, and renewed interest in hard assets, says Manish Chokhani, Director, Enam Holdings.

Speaking to ET Now, Chokhani noted that global money is being redirected back to the US as it tries to fix its fiscal and trade deficits. “India, like many others, has seen foreign direct investment flows slow down as funds are pulled into the US by policy diktat,” he said.

AI mania and hard assets in focus

Investor appetite is increasingly concentrated in AI-linked companies and sectors. “If you don’t have an AI play, nobody is really interested. From big US tech stocks to Chinese markets after DeepSeek, AI has become the growth magnet,” Chokhani observed.

At the same time, gold, silver, and even uranium are enjoying a bull run as investors hedge against dollar risks and seek exposure to the energy transition.

India’s unique position

Despite global headwinds, Indian markets remain buoyant thanks to steady retail inflows of nearly $3 billion a month. “India is still expensive—earnings growth of 9% with valuations at 20-21 times forward earnings. But retail investors are keeping markets strong,” Chokhani explained.

US vs India: A valuation reality check

Chokhani pointed out the scale mismatch between India and US markets. “The top six US tech companies together earned $500 billion last year, while the entire Nifty 500 made less than $200 billion. Next year, these firms could reach $600 billion and still trade at 20-25 times earnings,” he said, questioning whether global investors will prefer Indian equities over such opportunities.

He also highlighted gold’s performance over the past two decades, noting it has matched Indian equity returns, making it a real alternative for investors.

Shifts in India’s market structure

Looking ahead, Chokhani expects India’s market composition to change significantly. By 2027, he predicts profits of large banks like SBI, ICICI, and Axis could surpass those of giants like Reliance, TCS, and Infosys. “The index will need reconstitution. Most action is happening outside the index or in financial services,” he said.

AI’s real beneficiaries in India

Chokhani stressed that while India lacks a direct AI champion, financial companies stand to gain the most. “Banks and NBFCs sit on enormous data. As AI reduces costs and boosts productivity, financials will be the biggest beneficiaries,” he said.

Brokerages, fintech players, and capital market firms will also see long-term opportunities, though valuations are already high. “This space should be central to any investor in India, even beyond what the index reflects,” Chokhani added.