Key Points

This is a notable improvement as the shift indicates a good opportunity for long-term investors, according to the Union Mutual Fund report.

Despite global geopolitical tensions and trade uncertainties, the long-term outlook for India remains positive.

Harshad Patwardhan, Chief Investment Officer at Union AMC, said that strong macroeconomic fundamentals, healthy corporate and banking balance sheets, expected demand revival due to tax relief and welfare schemes, and signs of a new private investment cycle are all encouraging factors.

“Healthy corporate and banking sector balance sheets, prospects of a demand revival fuelled by tax relief and expanded welfare schemes, and the potential onset of a new private capex cycle are key positives driving for our outlook,” Patwardhan mentioned.

Madhu Nair, CEO of Union AMC, added that long-term investing is key to wealth creation. “It’s human nature to overestimate short-term impact and underestimate long-term potential. We believe the next 10 to 15 years hold great promise for the Indian economy and markets,” he said.

He urged investors to stay focused on their financial goals and keep investing through SIPs.

Union Mutual Fund is also optimistic about a boost in investments under the new tax regime, which came into effect from April 1.

As per the Union Budget 2025, individuals earning up to Rs 12 lakh annually will be exempt from income tax. "This will increase disposable income, giving households a chance to invest more in long-term instruments like SIPs," the report said.

With this positive market outlook and favourable tax changes, the report expects that monthly SIP inflows in the mutual fund industry could grow to Rs 40,000 crore in the next 18 to 24 months, supported by rising income levels and increased awareness about financial planning.

- IANS