Uday Kotak likens India story to a Bollywood film
BusinessToday.In September 11, 2019
Uday Kotak, the managing director of Kotak Mahindra Bank and Asia's richest banker believes that the India story is like a Bollywood film, complete with a hero, villains and a happy ending. According to him, while there are "a hundred things not going right with India" and the overall picture has been very challenging, things are never as good as it looks, but never as bad as it looks either.
"So if I take a photograph called India, it is always challenging. If I look at a movie called India - and I am looking at it from the lens of an entrepreneur over the last 30-35 years - it's an exhilarating journey," Kotak told CNBC-TV18 on the sidelines of the HT-Mint Asia Leadership Summit. Pointing towards the sea change that the financial sector has seen in the past few decades - from the 80s when over 97-98 per cent of it was public sector - he added that this kind of opportunity does not come in many parts of the world.
As for his Bollywood analogy for the India story, right now he sees a love story developing, "but there is a villain in the middle". He actually listed four of them, namely slowing growth, cash in the system returning to the pre-demonetisation levels, the challenges with GST collections and Indians' fear of investing at this point. He further said that this classic problem has tended to crop up every 10 years in the country, but things will get better over the next few years.
"In an interesting sort of way normally this problem starts in years ending with the number '8'," he said, referring to the Indian financial sector crisis post the Asian crisis in 1998, the global financial crisis of 2008 and the liquidity crunch that followed the IL&FS debt default crisis in 2018. "If you stick to what you are doing and are ready to take risks at the right time, you can get phenomenal returns over a long period of time," he advised.
What's a Bollywood film without a hero? Kotak sees the RBI donning the role. "The hero needs to drop interest rates further. My view is that the repo rate by March will be sub 5 from current 5.40 per cent," he explained. He also pitched for a slight depreciation of the rupee.