October Pulse - Sage Views - Glass Half Empty, Half Full

The four most dangerous words in investing are: 'This time it's different' - Sir John Templeton

Dear Investor,

September 2025 was the month of two halves. The month started on a positive note following improving economic data (August CPI inflation at 2.1%, Index of Industrial Production (IIP) for August 2025 at 4%), GST rate cut, optimism around India-US trade talks and the US Fed rate cut. However, the market witnessed a sharp fall on the Trump administration’s decision to impose a one-time fee of US$100,000 on new H-1B visa petitions and a 100% tariff on branded drug imports, leading to accentuated FII outflows of US$1.6 Bn for the month. Nifty still managed to end the month with 0.8% gains, with Midcaps and Small Caps outperforming with gains of 1.4% and 1.1% respectively. Foreign Institutional Investors (FII) were net sellers for the month of September 2025.

Sector-wise, Nifty PSU Bank (+11.4%), Nifty Metals (+9.6%), & Nifty PSE (+6.5%) were the top performing indices whereas Nifty IT (-4.3%), Nifty Media (-4.3%) & Nifty FMCG (-2.5%) were the laggards.

Market Outlook: Market sentiments continue to be impacted by geo-political issues, uncertainty around US-India relationships, weak private capex and subdued demand despite fiscal and monetary easing along with continued issuances of primary paper (IPO), reducing liquidity in secondary markets. We expect festive demand to pick up meaningfully – the impact of which will be witnessed in Q3 results along with logical conclusion of negotiations between US and India should bring calm to the market. Given the negative news flow and sell off by FPIs, it is easy to be pessimistic, but we have a more balanced view of the current environment. The recent changes in trade and geopolitics will push Indian manufacturing to a more integrated approach with an emphasis on localisation. This trend is positive for employment (which is required, given our demographics), and capital formation. India will need to balance infrastructure with consumption, as these are two significant drivers for our economy.

The macro conditions have not been better, as well as the robust corporate health, which makes us believe that the current market pause is a passing phase. We therefore remain positive on Indian equities over the next few quarters as the impact of a reasonably good monsoon, benign inflation and lower prices (due to GST reduction) play out. Further, as geopolitical tensions ease and trade relationships normalise, we could expect the return of FPI investors. We are cautiously optimistic on the new age companies focusing on platform delivery, travel, hospitality, and alternate energy.

What should investors do?

Investors should avoid investing in sensations, i.e. asset classes in trend, as the cycle for those asset classes (gold, silver, international equities etc.) will turn sooner than later. We belive gold, silver will see a more flatter period going further and valutions for equities are now reasonable. There might be a few hiccups before we see equities coming back to life, however that phase is not very long away.

What’s new at Sage Capital?

We are glad to announce a completely new website for all of you, which has everything you need. From risk profiler to portfolio review to creating a new account to information on all our services and products. The risk profiler which was earlier a Google Forms, is now live on the website itself, and investors can know their risk profile in less than 2 minutes.

Specialised Investment Funds (SIFs) are now available on our app. Reach out to us to know more about SIFs. We have already kickstarted our SIF journey with our investors opting to invest in the SBI/Magnum Hybrid Long Short SIF NFO.

You can also sign up for our app and get started with our all-in-one investing app. This will help you to make goal-based investments, and with our guidance, you will be able to do the right asset allocation and optimise your portfolio returns.

Our all-in-one link to access all our resources is here: https://linktr.ee/sage.capital

Apart from all this, feel free to Call/WhatsApp us at +91-8369664202 or reach our team at invest@sagecapital.in

Wishing all of you a Happy Diwali and a Prosperous New Year! 🪔

Warm Regards,

Nikhil Gupta

www.sagecapital.in