Anticipating structural changes post-Covid

We caught up with these five fund managers to find out what changes they expect in the economy and business in the aftermath of Covid-19, which sectors/areas are likely to be most impacted and which will bounce back sooner than others. Navneet Munot, ED & CIO, SBI Mutual Fund "Fully-open economies without virus fears are still a distant dream and consequently the outlook on growth, earnings and markets stays hazy. India's policy response has been encouraging in that it not just aims to address the immediate distress but also carries a vision for the long term. In the wake of this crisis, global firms will look to diversify supply chains as they weigh reliability against efficiency. India's policy intent is to fight for a position of strength in the changed world order. Continued focus on factor reforms - land, labour, capital and enterprise - as well as judicial and administrative reforms is encouraging, as is the continued thrust on uplifting the masses. We must leverage our social capital built during the last few months and the power of data and technology to accelerate our transformation. "For the global economy too, this crisis may turn out to be a blessing in disguise. Years of ultra-accommodative monetary policy had failed to revive wage inflation and investment activity, while rising wealth inequality had been an unwelcome side effect. This crisis has set the stage for unprecedented fiscal response to help revive blue-collar jobs and wages and aggregate demand. Deflation could eventually give way to inflation. Infrastructure creation and pick-up in the investment cycle can help kickstart the next upcycle for emerging economies. Also, as healthcare and virtualisation of processes become the centre-points of public policy everywhere, this could turn out to be a Y2K moment for India." Jinesh Gopani, Head of Equity, Axis Mutual Fund "The COVID incidence has forced us to rethink the growth outlook. We are reassessing the sectors that may get hurt for the longer term. While it is easier to notice problems everywhere, right from domestic stories to exports, the leaders of the next cycle are always difficult to predict, which may very well be same sectors/stocks. "The strategy that forms a core part of our investment p

This article was originally published on June 30, 2020.