Chockalingam Narayanan identifies 3 key emerging trends, says this on earnings
Narayanan said there is an emerging trend at a consumption level where people are increasingly choosing to consume more experiences rather than goods.
- Jul 29, 2026,
- Updated Jul 29, 2026 3:38 PM IST
Chockalingam Narayanan identifies 3 key emerging trends, says this on earnings, Head of Equities for the PMS and AIF business at ICICI Prudential AMC said stock returns are historically made if there is a combination of three things: earnings growth, return on equity (ROE) improvement, and favourable risk-reward.
In an exclusive interview to Business Today TV (BTTV), Narayanan said if one does get one or two of these three things in favour, an investor still tends to make some returns.
Among key emerging trends, Narayanan said there is an emergence of a trend globally looking for alternate supply chains. With the onset of the war, it has only got accentuated.
He noted that between 2000 and 2020, the world was moving only towards globalisation and looking for the most efficient supply chain. Today, he said, the world is looking at a combination of a local supply chain, a friendly supply chain, and a global supply chain.
Narayanan said: "When such things happen, you are not playing at scale, but you are playing for resilience. In that kind of a construct, companies which can participate in that creation of alternative supply chains tend to benefit. In that sense, manufacturing businesses are seeing better earnings growth," he said.
A second trend is at a consumption level where people are increasingly choosing to consume more experiences rather than goods. The third area with a lot of activity is a few free trade agreements (FTAs) being signed and newer markets are getting opened up for companies that are catering to different markets at scale.
"That's probably the third bucket that I would kind of call as the area of opportunity or green shoots that you can think of," Narayanan said.
The expert said Indian stock market is at interesting juncture, given all the geopolitical uncertainty that it is seeing, particularly this year and over the last three, four years.
The way the market has evolved made Narayanan believe that it remains a period for stock picking.
"While at the macro level, things thankfully are actually quite decent. We would say, uh, you know, fiscal deficit, to GDP is at a very comfortable level. The balance sheets, across most constituents of the economy are in a reasonable shape, be it the corporates, be it central and state governments," Narayanan said.
He said corporate balance sheets are healthy and earnings are reasonably good so far. From a subdued earnings two years ago, there has been a decent recovery, with the last three-four quarters seeing mid-teens earnings growth.
"In this quarter and possibly the next quarter, given that we've had the situation in the Middle East, we've had a little bit of uncertainty with regards to earnings. But that said, I think there is a higher pricing-led earnings growth. Volume has got impacted a little bit given the supply chain challenges that we have seen, uh, you know, as a result of these developments," Narayanan said.
Else, Narayanan said India possibly could have started FY27 with 17-18 per cent earnings growth. As of today, that number could be somewhere in the 12-13 per cent ballpark range, Narayanan said.
Taking about his clients, Narayanan said PMS services are more of a solution than products. In that sense, individual's requirements kind of tend to differ from the one other, he said.
But at the broader level, there are 7-8 different investment styles and different market cap based strategies that one can offer to investors.
What suits them, in conjunction with their advisors, is what they tend to pick, he said.
Narayanan said as an institution ICICI has always been a big proponent of asset allocation, saying the asset allocation is done the investor along with their advisor at their end, and only the equity portion of the money they consider, are solutions for that.
"Look at some of the flexi-cap strategies that we kind of run. They range from value, which is at one end of the spectrum in terms of investment style. In a value sort of a strategy, the higher proportion of earnings, higher is the proportion of return potential, we tend to believe," Narayanan said.
Chockalingam Narayanan identifies 3 key emerging trends, says this on earnings, Head of Equities for the PMS and AIF business at ICICI Prudential AMC said stock returns are historically made if there is a combination of three things: earnings growth, return on equity (ROE) improvement, and favourable risk-reward.
In an exclusive interview to Business Today TV (BTTV), Narayanan said if one does get one or two of these three things in favour, an investor still tends to make some returns.
Among key emerging trends, Narayanan said there is an emergence of a trend globally looking for alternate supply chains. With the onset of the war, it has only got accentuated.
He noted that between 2000 and 2020, the world was moving only towards globalisation and looking for the most efficient supply chain. Today, he said, the world is looking at a combination of a local supply chain, a friendly supply chain, and a global supply chain.
Narayanan said: "When such things happen, you are not playing at scale, but you are playing for resilience. In that kind of a construct, companies which can participate in that creation of alternative supply chains tend to benefit. In that sense, manufacturing businesses are seeing better earnings growth," he said.
A second trend is at a consumption level where people are increasingly choosing to consume more experiences rather than goods. The third area with a lot of activity is a few free trade agreements (FTAs) being signed and newer markets are getting opened up for companies that are catering to different markets at scale.
"That's probably the third bucket that I would kind of call as the area of opportunity or green shoots that you can think of," Narayanan said.
The expert said Indian stock market is at interesting juncture, given all the geopolitical uncertainty that it is seeing, particularly this year and over the last three, four years.
The way the market has evolved made Narayanan believe that it remains a period for stock picking.
"While at the macro level, things thankfully are actually quite decent. We would say, uh, you know, fiscal deficit, to GDP is at a very comfortable level. The balance sheets, across most constituents of the economy are in a reasonable shape, be it the corporates, be it central and state governments," Narayanan said.
He said corporate balance sheets are healthy and earnings are reasonably good so far. From a subdued earnings two years ago, there has been a decent recovery, with the last three-four quarters seeing mid-teens earnings growth.
"In this quarter and possibly the next quarter, given that we've had the situation in the Middle East, we've had a little bit of uncertainty with regards to earnings. But that said, I think there is a higher pricing-led earnings growth. Volume has got impacted a little bit given the supply chain challenges that we have seen, uh, you know, as a result of these developments," Narayanan said.
Else, Narayanan said India possibly could have started FY27 with 17-18 per cent earnings growth. As of today, that number could be somewhere in the 12-13 per cent ballpark range, Narayanan said.
Taking about his clients, Narayanan said PMS services are more of a solution than products. In that sense, individual's requirements kind of tend to differ from the one other, he said.
But at the broader level, there are 7-8 different investment styles and different market cap based strategies that one can offer to investors.
What suits them, in conjunction with their advisors, is what they tend to pick, he said.
Narayanan said as an institution ICICI has always been a big proponent of asset allocation, saying the asset allocation is done the investor along with their advisor at their end, and only the equity portion of the money they consider, are solutions for that.
"Look at some of the flexi-cap strategies that we kind of run. They range from value, which is at one end of the spectrum in terms of investment style. In a value sort of a strategy, the higher proportion of earnings, higher is the proportion of return potential, we tend to believe," Narayanan said.