India’s next phase of wealth creation will not come from sudden disruptions, but from steadily expanding profit pools in financials, digital lending, automobiles, and emerging technologies like artificial intelligence, said Motilal Oswal Group’s Chairman Raamdeo Agrawal.
Speaking on market volatility and long-term opportunities, Agrawal said India’s growth trajectory remains predictable despite geopolitical tensions and periodic shocks.
India’s equity markets may be navigating turbulence, but Agrawal sees no reason to reassess the country’s long-term profit trajectory. Addressing concerns around geopolitical risks, including the ongoing conflict in West Asia, the veteran investor was clear that such developments do not fundamentally alter India’s economic direction. “I don’t see any profit pool suddenly disappearing. The current dispensation is not going to change. Just because the Iran war is there, nothing is going to change. Things are going to fall in place,” Agrawal said.
Agrawal added that this pool is far from mature. “That profit pool will keep growing at about 10–15%,” he noted, underlining the structural nature of India’s credit growth story.
Within financials, he identified digital lending as a major long-term opportunity, even though it is still at a nascent stage today. “Digital lending today is very small. Maybe not even a one lakh crore book,” he said. “But at some point in time, digital lending will become very large.”
Drawing a contrast between scale and growth, Agrawal explained how smaller segments often generate the most disproportionate expansion. “So that five lakh crore becomes ten lakh crore, but digital lending from one hundred crore can go to one lakh crore,” he said.
Beyond financials, Agrawal highlighted the automobile sector as another area where profit pools are likely to expand significantly over time, driven by rising affordability and aspiration. “It’s a growing economy,” he said, referring to recent commentary on demand trends. “There are robust inflows from two-wheelers to four-wheelers because entry-level cars have become cheaper.”
He pointed out that India’s auto production is still well below its long-term potential. “Today, we are producing about five million cars. In fifteen years’ time, you should be doing more like twenty million cars,” Agrawal said.
While he acknowledged that profits in the automobile sector may still take time to peak, he remained confident about the long-term opportunity. “Who will make money is a little later,” he said. “But the profit pools of the car industry will explode.” On emerging technologies, Agrawal struck a pragmatic note, especially around artificial intelligence. “We don’t have pure AI companies right now,” he said. “In the listed space today, AI companies’ profit is zero.”
However, he was equally clear that this would not remain the case indefinitely. “It’s not going to remain zero ten years out. New profit pools will emerge there,” he added.
Looking at India’s broader economic journey, Agrawal described the country as a steady, compounding growth story rather than one defined by dramatic leaps. “That’s how I’ve seen the evolution of this country, step by step, day by day,” he said. “It’s a very complicated, predictable country with some roadblocks and potholes.”
He cautioned investors against expecting a smooth ride. “It is never a straight line,” Agrawal said. “If it were a straight line, the journey would be over in ten years, not seventeen.”
Despite near-term volatility and global uncertainties, he believes India is well-positioned to absorb shocks. “We are used to these potholes,” he said. “Many more will come. Names will be different, but it will be there.”
