Republic Summit 2026: Sundeep Sikka, CEO & MD- Nippon India Mutual Fund, Investing In India's Future

[00:00:00]Over the past about a year and a half I've been waking up every morning 7:30 checking Gift Nifty.

[00:00:05]It is down. Indian markets have been performing I mean amongst the worst performing markets over the past about a year plus and my portfolio is is in red. How frequently do you check Nifty? How frequently do you do you just keep refreshing your charts?

[00:00:24]>> Well, then I think for my personal portfolio like you, I don't look at the markets.

[00:00:29]>> Okay.

[00:00:30]>> Uh at least maybe not even once in 10 days.

[00:00:33]>> Okay.

[00:00:33]>> So, I think you should not be looking at you're doing a mistake every morning looking at tracking the index. That's not what you should be doing as an investor. That's what the professional professional have to do.

[00:00:42]>> Okay. But then really tell me I mean it's been it's been a year plus now.

[00:00:46]Things seem to be coming back to normal.

[00:00:48]We have the peace deal already happening. What's really happening with the Indian markets? Why are our portfolios down? What are some of the factors that have been affecting the Indian markets over the past about a year plus?

[00:01:01]>> Well, then I think it's very important to look at it. It's one should never see markets from one year or six months point of view. You have to see from a long almost a 12 to 15 years of bull run.

[00:01:12]Markets have been doing well. Portfolios have been doing well. There's so much wealth that has been created by the retail investors.

[00:01:18]Any market, you know, I mean any kind whether it's commodity, whether it's capital markets will go through the cycles. After a long bull run of almost 10 years, we've seen certain consolidation and this is both a function of you know, I'll say rather a more of a function of what's happening globally. I think a lot of things that are happening globally whether to be geopolitical, oil, balance of payment, you know, you know, a lot of these things have had an impact. But should we be worried? Answer is no. And that's exactly the reason I'll actually go back to as a country we're going through a very interesting transformation where a country of savers is becoming a country of investors. I think you're seeing effectively millions of investors investing in mutual funds through systematic investment plans irrespective of the volatility that you talked about.

[00:02:03]We did not see the SIPs, you know, stop.

[00:02:06]We saw more and more investors are coming into SIPs. And I think what what you have seen is rather it's one of the most, you know, I mean one of the history is getting created where more investors are coming from small towns, you know, investing in Indian capital markets. They are not watching India grow, but they're participating in India growth.

[00:02:24]>> You know, Sandeep >> Uh just to add, you said SIPs have been increasing. We've been moving from a savers, uh you know, a retail uh investor who was a saver earlier to someone who's an investor right now. Uh from from I have the numbers 9 trillion to 81 trillion from 2014 to currently.

[00:02:42]Uh do you think the domestic investor is more bullish on India than the global investor?

[00:02:48]>> No, I think uh it's not about bullish. I think domestic investor is the key for any country. I think what we have to understand is, you know, what we saw over the period of last if you say generations, you know, it took 50 years for Indian mutual fund industry to be 10 lakh crores.

[00:03:04]Uh in last 10 years >> [music] >> it has gone from 10 lakh crores to almost 85 lakh crores, and it continues to grow.

[00:03:11]And what this industry was originally more to do with uh big cities and now we are seeing more investors coming from small cities and towns. But the bigger question, you know, are Indian investors bullish? I think I've never seen Indian investors, domestic investors more bullish on the India growth story.

[00:03:26]>> What are the factors? What are the Why why should uh anybody sitting in this room be investing uh in mutual funds at a time when we are seeing uh so much turbulence going on? When when we look at the the markets or the portfolios over the past year, people say, "Sir, is it such a FD may invest real estate Why should anybody sitting here in this room invest in mutual funds?"

[00:03:47]>> Why should anybody not invest in mutual funds? If you are an Indian, you have to invest in the growth story. And the only way to invest in the India growth story is through mutual funds.

[00:03:55]>> Okay.

[00:03:56]>> Mutual fund is a proxy to the India growth story. I mean, we saw Indians, you know, let me give you an example.

[00:04:02]And investor behavior changes over generations. We saw Indians used to invest in gold, real estate, physical assets. But let's go back to 2000, and it's the 12th year of Prime Minister. In 2014, 53% of the household savings uh financial savings used to come into financial assets. Today, it's gone to 63%.

[00:04:21]>> Mhm.

[00:04:21]>> Earlier, 1% of their financial savings used to come in mutual fund. Today, it's gone to 7%.

[00:04:26]>> Okay.

[00:04:26]>> I think it's basically feeling of being pra- feeling proud that you're participating in the India growth story.

[00:04:32]You're seeing India doing so well. And again, many times you'll see these headlines, you know, many times you'll see some small short-term problems, but those problems are in every country in the world. It's not basically about India.

[00:04:42]>> Okay.

[00:04:42]>> Rather, it's the other way around. India is a shining star. I think foreign investors, for a minute, they have an option to get into different city uh different countries, and I'll come to that part also a little later. But for Indian investors, there's nothing better than investing in the Indian capital markets because it's not just a question of a return, it's also a question of feeling proud that you're participating in the India growth story.

[00:05:03]>> Okay. Do you Do you personally invest in mutual funds?

[00:05:06]>> 100% of my financial assets are in mutual fund.

[00:05:08]>> Okay. And how frequently do you check your portfolio?

[00:05:11]>> So, I'm a great, you know, I'm a very lazy investor.

[00:05:14]>> How did Rather, tell us how did your mutual fund journey actually begin?

[00:05:19]>> My journey as an investor and in as my career, both started as an accident.

[00:05:23]>> Okay.

[00:05:23]>> I mean, it was not designed. It was not that I think I decided that I'm going to be in my career of mutual fund, you know, I'm going to be in this industry. Neither did I decide that I'll start investing in mutual funds.

[00:05:34]I think I also come I started my uh corporate job way back in mid-90s. I came from that generation where bank deposit were considered to be the safest.

[00:05:43]>> Okay.

[00:05:43]>> I came from a generation where uh parents used to tell us stock markets are risky and >> that's where I came from. But I think it's a question of today I think took a lot of time education to realize. I think by putting money in bank deposits, I think inflation is taking away your returns. There's no way better to create return by rather than investing in mutual funds. That is one.

[00:06:05]From a career point of view again, I was a banker and I ended up here and I feel there's no better profession than being in the mutual fund industry because you're creating helping million of investors >> create wealth. Okay. But then every morning when you get up I mean somebody who's managing a portfolio of 8 lakh crore AUM.

[00:06:21]Uh is it a lot of pressure?

[00:06:24]>> Well, the pressure starts when at 5:30 6:00 I go to the gym in the morning somebody will pat on this thing you know I mean this is it the pressure starts 5:30 in the morning you know. But I think the reality is I think you have to take it in the stride. People are getting educated. There was a time people used to get very you know I mean and again I'll go back. You have to go with data. The fact that there are 10 crore investors who are investing in SIPs and they're holding on to the SIPs in spite of the volatility. I think that shows you investors have gone away from the fact that I think every time market goes down they need to be worried. Every time market goes up they need to you know start feeling happy.

[00:06:57]>> Because ultimately what you're investing is more from a long-term point of view.

[00:07:00]>> I'm going to ask you one question which is going to be of personal interest to many of us here. We're always confused as to how many mutual funds should you really have in your portfolio. What would Sandeep Sikka advice would be?

[00:07:13]>> Ideally a portfolio should not have more than seven eight schemes.

[00:07:16]>> That's a lot.

[00:07:17]>> That's all.

[00:07:18]>> Okay.

[00:07:18]>> Because what happens is over a period of effectively the underlying is the same.

[00:07:22]>> Okay.

[00:07:23]>> So effectively it could be a portfolio could be made depending on the risk appetite of the investor, large cap, mid cap, small cap and also fixed income.

[00:07:32]And also this is on the active side.

[00:07:34]There could be investors who globally passives have become very big. I think we have seen in the investors investing in passives a lot you know index funds.

[00:07:41]So I think effectively not more than five to seven schemes are required.

[00:07:45]Anything after over and above that is just a clutter.

[00:07:48]>> Okay. For anybody sitting in this room who wants to start his or her investment journey, what would be those three factors that he or she must examine before really getting started with their mutual fund journey?

[00:08:00]>> I think the first the most important part is basically the individual's own risk appetite.

[00:08:05]I think to your question, like you mentioned a while it was on the lighter side every morning you see 7:30 in the morning. I'm assuming it's on the lighter side you don't do it uh uh uh uh >> Okay.

[00:08:12]>> everyday you check the markets.

[00:08:14]Uh if you don't have that appetite to take care of turbulence, volatility, one should not invest in capital markets.

[00:08:21]And I'm saying capital markets, I'm not trying to say stock market or mutual funds.

[00:08:25]>> Okay. No.

[00:08:26]>> Number two, every individual is different. I think a lot of time people try to copy. You know, today someone who's investing for a 30-year horizon is very different from somebody who's investing at the age of 50. So, risk appetite is a very important.

[00:08:39]>> Okay.

[00:08:39]>> And third and the most important thing is never to get carried away with noise and sound.

[00:08:44]>> Okay.

[00:08:44]>> what happens is many times there will be a lot of time, you know, I mean you'll see budget getting announced, new policy getting announced, you know, something Trump doing something. So, what happens all of a sudden we get carried away with that.

[00:08:54]>> Right.

[00:08:55]>> Investment is a very very boring game.

[00:08:57]You have to control your emotions. You have to stay invested for long term point of view. And I think just uh there was this old ad of I think Hero Honda, "Fill it, forget it."

[00:09:06]>> Okay.

[00:09:06]>> You know, I think "Fill it, shut it, forget it."

[00:09:08]>> Okay.

[00:09:08]>> That's exactly the way you have to make your portfolios. Invest and forget.

[00:09:12]>> Okay.

[00:09:13]>> Sandeep, I'm going to drag you back to the macros. Uh while DIIs or domestic investors, retail investors have been bullish on the India growth story, FIIs have just been selling.

[00:09:23]Uh do you think the Despite which the there has been a sort of cushion the DIIs have given some kind of cushion to the markets. Do you think the Indian market is decoupled? Will it be right to say that the Indian market is in a way decoupled from what is happening across the globe?

[00:09:36]>> Let me on a little lighter side since you talked about the FIIs and going out.

[00:09:40]Uh I don't think so FIIs can stay out of India for long term.

[00:09:43]>> Okay.

[00:09:43]>> And I and I let me give you an analogy, you know, a very different analogy in a non-finance, you know. I think we're sitting here in the Republic event, you know.

[00:09:51]Uh a viewer in the evening may see multiple news channels. You may surf through different channels, but in the end to get the best you'll come to Republic.

[00:09:59]>> Okay.

[00:09:59]>> So foreign investors also in the end they will have to come to India. Short term they can look at anything else, but from a long term point of view, you know, they have to come to India.

[00:10:07]>> But but but let me play the devil's advocate. What what are those factors? I mean, fine, the government has already taken some decisions that will kind of help the downfall I mean, you know, kind of prevent the downfall of the rupee.

[00:10:19]What are some of the What are some of the other taxes, for example, is another thing which is What are some of the factors that must be addressed for the foreign investor to be bullish on India story once again?

[00:10:31]>> I think we should not get over carried away with, you know, how have been the FIIs going going out. I think what we have to be happy is today as the foreign money went out, you saw that was basically taken care by the SIP flows.

[00:10:43]Today we are at a point where roughly SIP flow is 30,000 per month.

[00:10:47]Effectively we are talking of 40 to 50 billion dollars of SIP money is coming in. And when we are talking of SIP 40 billion dollars, I mean, that is the kind of outflow we have seen.

[00:10:56]>> Right.

[00:10:56]>> I'm not trying to say money has no color. We need foreign and domestic.

[00:11:00]>> Okay.

[00:11:00]>> But just think of a situation 10 years back if foreigners had taken out the money and the SIP was not there. I think what the situation would be.

[00:11:07]>> Okay.

[00:11:07]>> I'm very happy and proud we're in a very strong position at this point of time that I think the domestic mutual fund industry has built the infrastructure.

[00:11:15]And I want to go back a step back a little, you know.

[00:11:17]>> Okay.

[00:11:18]>> I think way too back for 2014 the size of the industry was like about 10 12 lakh crores, you know.

[00:11:23]>> Okay.

[00:11:24]>> I mean, since then there have been multiple changes that have taken place because of which the industry has, you know, reached where it is. But some of the things which have really played a very big role. 2014, we saw the Jan Dhan schemes, the number of bank accounts being opened. After that, 2015, we saw the digital 2016 demonetization, 2017 UPI. All these things are helping the to get more mutual fund investors, the retail investors into Indian capital markets.

[00:11:51]We are doing our part right.

[00:11:54]Corporate India is doing well. I think we should not get carried away with the foreign money going out. Again, I'm trying to say money has no color. We need money from everywhere, but the fact is we are happy and proud that today domestic Indian domestic investors have been able to take care of the market in spite of the fact the foreigners have gone out. Foreigners have a choice. They will look at every market. They will be short-term at all points of time, but Indians, they will be an emotional reason for us to keep investing in India, and they are getting rewarded for that.

[00:12:23]>> As a as a foreign fund house, is it difficult to convince Indians?

[00:12:27]I mean, I just want to you know, you've been you're you're a Japanese you know, you fund house. Is it really how difficult or easy is it to convince Indian investors to invest in mutual funds?

[00:12:39]>> It was very difficult 10 years back. I think it's much easier now. I think the way you have to see this is maybe 10 years back when we had to go and talk about mutual fund, it was you know, what is mutual fund? People used to think mutual fund is a different you know, it's a different animal.

[00:12:54]But today, the fact is you know, let me go back and I have always said this in many forums and I say this again. When my father retired from government job, you know, I had to convince him to put his money into mutual funds, his retirement benefits. But when my daughter started working, I did not even have to ask her to put money in mutual fund. She herself invested in the SIPs. That's the new generation, you know, that's the way things are changing. So, your question was very relevant long back.

[00:13:17]>> Okay. But then what are what are those factors that have kind of helped change this perception over the years gone by?

[00:13:22]>> I think a mix of multiple things. Let me you know, I think there's a lot of you know, we need to compliment the industry and fee regulator SEBI. I mean there's a lot of investor education that has happened and media has played a very big role. I mean thank you for having me today here.

[00:13:35]You know, I mean the fact that it tells you know, I mean mutual funds are becoming one of the key key avenues, you know, I mean not only for the investors to invest, but if you were to look at from a Vixit Bharat point of view, I think mutual fund industry will continue to play a very very big role in getting domestic savings into for domestic savings into capital markets which is required for the growth of the country.

[00:13:56]>> Wonderful. Sandeep, thank you very much and just to add you are actually doing a Harger mutual fund investor campaign with us. So yes, we will track India's mutual fund journey, markets journey, investment journey and keep troubling you for more as we progress collectively. Thank you very much for being here with us.

[00:14:10]>> I'll just like to add by saying you know, when we look at the Indian economic story, you know, history getting created, I think it will be a very interesting thing over over and above the government policies, one of the key things will be it will be going to be a rare case where Indian investors themselves has participated and helped the Indian grow, you know, by and that is through mutual funds.

[00:14:29]>> Wonderful. Thank you very much. Thanks a lot.

[00:14:32]>> Thank you very much Mr. Sikha for those valuable insights. Please remain here on stage as I request Pranav to please do us the honors of presenting you with a small token of our appreciation. Pranav, the hamper is here.

[00:14:46]>> [music] [music] >> We also have a We also have a stole for him, Pranav.

[00:15:01]We also have a stole for you, sir.

[00:15:07]>> [music] [music] >> Thank you so much. Thank you, Pranav and thank you Mr. Sikka.

[00:15:26]>> [music] >> Ladies and gentlemen, may I request you all to please be seated. Our next keynote speaker represents a new chapter in the governance journey of the national capital.

[00:15:40]As the Chief Minister of Delhi, Srimati Rekha Gupta has focused on strengthening public services, accelerating infrastructure development, and advancing the vision of a cleaner, more efficient, and future-ready city.

[00:15:57]Ladies and gentlemen, round of applause for our Chief Minister, Srimati Rekha Gupta.

[00:16:05]Please be seated as we now share with you Rekha Gupta's journey, which has been dedicated to the city of Delhi.

[00:16:15]>> [music] >> May Rekha Gupta