'Trump always chickens out': Saurabh Mukherjea sees India-US deal coming and is betting where it counts

India and the United States are likely to strike a trade deal within the next few months, and despite current tensions over tariffs and Russian oil, the long-term dynamics still tilt heavily in India’s favor, says Saurabh Mukherjea, founder of Marcellus Investment Managers.

Mukherjea, in an interaction with NDTV Profit, dismissed fears around a potential 25% tariff hike by the U.S., calling it “par for the course.” 

He argued that critical Indian exports like pharmaceuticals, electronics, and IT will likely be exempt, with only limited impact on segments like textiles and auto. “Even if this 25% tariff were to go through, high chances are pharma, electronics, and IT will be completely exempt,” he said.

He emphasized that Marcellus views any overreaction in the markets as a buying opportunity. “If companies like Sona Comstar or Divi’s Labs come off dramatically, we’ll think of buying more,” he added. His firm’s global strategy has historically capitalized on market dips following U.S. tariff threats, coining what he jokingly calls the “TACO” trade—“Trump Always Chickens Out.”

Beyond tariffs, Mukherjea pointed out that America fundamentally needs India in two critical sectors—electronics and pharmaceuticals. “Apple is the star play,” he said, referring to the tech giant’s increasing shift to Indian manufacturing. On pharma, he noted, “China still supplies 70–80% of America’s active pharmaceutical ingredients (APIs), India the remaining 20–30%. America knows it needs to diversify.”

He added that while countries like Vietnam offer alternatives, they are not at scale. “It’s not evident to me that countries like Vietnam are beyond the point credible alternatives to India,” he said.

The friction, according to Mukherjea, centers on American pressure to open up India’s markets to U.S. agricultural and dairy products—an area of long-standing resistance in New Delhi. Still, he remains confident: “My reading is there will be a deal that will get done over the next couple of months.”

Marcellus is positioning accordingly. The firm holds Divi’s Labs and Acuitas (formerly Ami Organics) in its small-cap portfolios. On the electronics side, Mukherjea said companies like Dixon remain on their radar. “If EMS (electronics manufacturing services) plays become cheaper courtesy Mr. Trump, so much the better—we’ll look to buy.”