Indian Markets Remain Resilient In June amid global uncertainties: PL Asset Management
FinTech BizNews Service
Mumbai, July 22, 2025: PL Asset Management, the asset management division of PL Capital Group (Prabhudas Lilladher), in their recent report ‘PMS Strategy Updates and Insights’, cited that Indian equities remained resilient despite mid-month volatility triggered by geopolitical tensions. This stability was underpinned by robust domestic macroeconomic indicators and a gradual improvement in investor sentiment.
Indian equities posted broad-based gains in June, as improving participation and steady domestic fundamentals outweighed mid-month global concerns. While geopolitical tensions initially kept markets cautious, a ceasefire-driven rebound in global equities helped restore investor confidence.
The report highlights that Nifty 50 rose 3.1% during the month, extending its leadership on a 12-month basis with a 6.3% return. The Small-cap 250 index led the monthly performance with a 5.73% gain and delivered 4% annual returns, highlighting a renewed investor appetite for broader market segments. Meanwhile, the Nifty Mid-cap index registered a 4.1% rise in June and a 5.6% return over the past year. The overall momentum was supported by resilient macro fundamentals and improved breadth across sectors. Geopolitical volatility saw crude surge, adding to mid-month volatility in the Indian markets, however - global economic activity was revived (39% MoM rise in the Baltic Dry Index) which supported equity markets.
The report notes that June month saw cyclicals led outperformance. Digital (5.42%), Infrastructure (4.89%), and Tourism (4.38%) stood out in June, while Healthcare (15.01%), Defense (21.78%), and Finance (14.3%) emerged as the top annual performers. Banking and IT also saw robust gains, supported by a resurgence in credit demand and digital transformation tailwinds. Overall, Mid-Small caps and high-risk style exposures outperformed on one-month basis, though both still continue to lag on a 12M rolling basis.
On valuation metrics, the report notes that it indicated a modest shift towards the expensive zone, particularly in the mid and small-cap segments. However, PL believes that valuations remain largely justified given the underlying earnings trajectory and improved macro conditions.
“Market sentiment has started to rebound meaningfully since late March 2025, with a growing number of stocks trading closer to their 52-week highs than lows. This shift signals a broad-based improvement in participation, supported by the rising Nifty500 Equal Weight vs Nifty500 1Y rolling return spread, which is climbing off a cyclical low—an early sign of improving market breadth and potential reversal or consolidation.
At the same time, the lack of wide dispersion in factor performance suggests there's no clear dominance of a single style, making a balanced, multi-factor approach better suited for navigating this phase of market normalization.
Mr. Siddharth Vora, Head - Quant Investment Strategies & Fund Manager, PL Asset Management and Executive Director, Prabhudas Lilladher said, “June data confirmed the ongoing disinflation trend, with strong tax collections and capital expenditure aiding macro stability. However, external headwinds such as volatile FII flows, tariff-related uncertainties, and monsoon outcomes remain key variables to watch in H2CY25.”
On Aqua
AQUA returned 5.45% in June, outperforming its benchmark which posted a 3.7% gain. Despite low exposure to small caps, financials and rising allocation in cyclicals drove the portfolio’s outperformance, alongside smart factor rotation. Since inception, AQUA has delivered a 27.07% annualized return, outperforming the benchmark’s 22%. Aqua has delivered over 28% returns in the last two years, with strong alpha generation compared to both the Nifty 50 and BSE 500.
Multi Asset Dynamic Portfolio
In June, MADP posted a return of 2.35%. The portfolio strategy remained consistent, with approximately 25% allocated to gold amid rising global uncertainties, around 74% in equities, and 1% in cash. Within equities, the allocation to large caps held steady at about 37%, with a similar share in mid and small caps. Over the past three years, MADP has delivered an annualized return of 15.09% with volatility under 10%, outperforming the benchmark return of 14.77%.
