"I'm looking at the markets more positively"

Only a handful of mutual funds follow a contrarian investing style, and Invesco India Contra Fund is one such fund. Having generated superior returns for its investors in the long term, we wanted to know how contrarian strategies have kept the fund ticking for so long. For that, we got in touch with Taher Badshah. There's no better person to speak to than him, as he is the fund manager and the CIO of Invesco Mutual Fund. He shares his insights on market valuation, growth vs value style of investing, and in which pockets of the market he is currently finding contrarian opportunities. The current economic situation is uncertain, with India's interest rates stabilising while developed nations continue to raise rates. The potential for a recession in the US is still a worry. Despite this, Indian markets are at an all-time high, with even FIIs showing confidence. What's your take on the current market sentiment? At the end of the last calendar year, we started off with a conservative expectation about the market. There were a few reasons which made us believe that it will be a year of readjustment post the COVID-related era of 2021-22 and markets might end up being range bound. However, many things have changed and are looking a lot more favourable compared to what they were at the start of last year. Growth has not turned out to be as bad as what the market started to anticipate. Because of flat performance of the market for six months of this year, our relative valuations have actually become a lot cheaper and more desirable compared to what they were six months ago. The premiums have now come back to average and are a lot more appetising than what they were at that time. Now we're not sticking like a sore thumb between other emerging markets and developed markets. Consumption is still on the weaker footing, but it has not fallen off a cliff, at least urban consumption. On the other hand, the investment cycle got even stronger (led by the public sector investments in core areas of the economy, in transport, power, defence, railways, and logistics). Alongside the investment cycle, there is an embedd