Dear Investor,

As we embark upon 2026, I extend my warmest greetings and best wishes for a prosperous year ahead. The year now behind us has been a testament to India's economic resilience and structural evolution. Against a backdrop of global uncertainties, our economy has charted a course of robust growth while maintaining price stability - a commendable achievement. Simultaneously, thoughtful regulatory reforms have fortified our financial architecture, streamlined business processes and elevated consumer safeguards. These developments have not merely addressed immediate challenges but have laid the groundwork for sustained economic momentum that will propel us toward our collective aspirations in the years to come.

Reflecting on 2025, India's headline index extended its gain to 10 years in a row, buoyed by several positive developments such as tax and interest rate reductions, an upgrade to India's sovereign credit rating, record SIP inflows and a revival in consumption. This performance materialized despite ongoing tariff-related uncertainties and substantial foreign investor outflows. Nevertheless, India's growth trajectory remains firmly positive and aligned with the vision of achieving Viksit Bharat by 2047.

A notable development during the past year was the RBI cutting rates by 125-bps to enhance systemic liquidity and ensuring credit growth outpaces deposit growth. As we enter 2026 with lower interest rates, corporates are better positioned to optimize their balance sheets, potentially translating into improved profitability. While accelerated currency depreciation supported export revenues, foreign investors may reassess their strategies and potentially re-enter the market in 2026, anticipating currency appreciation rather than further depreciation.
For investors embarking on their wealth creation journey or recalibrating existing portfolios, the investment approach should be viewed through the "SIP for LIFE" framework—combining the discipline of Systematic Investment Plans (SIP) with the convenience of Systematic Withdrawal Plans (SWP). SIPs facilitate the conversion of regular investments into long-term wealth, while SWPs transform accumulated capital into steady income streams. Equity, with its demonstrated track record as a wealth creator across market cycles, should remain the predominant asset class for long-term investing. Portfolio construction should incorporate a blend of passive and active funds across Large-Cap, Flexi-Cap, Balanced Advantage and Multi-Asset Allocation categories, calibrated to align with individual asset allocation objectives.

Happy Investing!

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Regards,
A. Balasubramanian