Sankaran Naren's tough love for investors

Sankaran Naren, Chief Investment Officer at ICICI Prudential Mutual Fund, recently caused a stir with his candid advice to investors, suggesting they consider redeeming from mid- and small-cap funds, citing their heated valuations. That's not it. Naren, in his signature no-nonsense style, also highlighted other risks in today's market, from the illusion of SIP safety to the dangers of redemption cycles. His blunt insights were a rare dose of hard-hitting realism. We've distilled some of them here, but his full address is a must-watch. Find it here: https://tinyurl.com/492x447r. The risk? It's yours, not theirs Naren takes a shot at how companies used to lean on banks for funding, but not anymore. Now, it's the investor who carries the burden. He points out how firms are opting for Qualified Institutional Placements (QIPs) and IPOs to fund growth. The result? The risk has quietly shifted from banks to investors. "What they do is announce a QIP or an IPO and raise money from you. Banks are taking no risks. Their balance sheets look fantastic. All the risk is being taken by you." This shift means that while companies and banks keep their balance sheets healthy, the risk is silently being absorbed by investors. And while raising funds through equity is great for companies, investors need to be discerning about where they park their money. SIP isn't always sahi? Naren's take on SIPs (Systematic Investment Plans) was equally blunt. SIPs aren't bad, but doing them blindly is. He warned against short

This article was originally published on April 01, 2025.