For India, which imports 85-88% of its crude oil requirements, the prospect of lower oil prices removes a key overhang on inflation, the current account deficit, and corporate margins. Market participants now see this as a potential trigger for a recovery in participation from retail investors, HNIs, and tactical traders. Therefore, complementing steady DII and SIP flows and possibly unleashing broader local buying.
Ashwini Shami, President & Portfolio Manager at OmniScience Capital, said current valuations combined with a stabilising geopolitical environment present a compelling case for sidelined capital. “The combination of reasonable valuations and a more stable geopolitical backdrop could encourage investors to increase risk exposure,” he noted.