“No, we are not buying right now. It seems that the war has intensified. Sixteen ships were destroyed in the Strait of Hormuz and the attack on Tehran was very intense. The price of oil was $122 and now it has fallen to about $88. But we have not seen the end of this war yet, and it may end soon according to President Trump.”
The crisis, now entering its second week, is raising concerns about global energy supplies. Brent crude has risen 46% since the start of the year, weighing on oil-importing economies like India.
“Brent is $88 above $60 on January 1. This is negative for countries like India, South Korea and Japan. Gas is a major problem due to dependence on Qatar. The impact is felt in OMCs, automobiles, tires, paints, plastics, fertilizers, aviation, chemicals and even hospitality. Some restaurants are even refusing to use their own gas.” he said.
Despite the market’s losses, Trivedi refrained from predicting specific levels for benchmark indices, pointing to global investor sentiment.
“We did very well in February with trade deals and FPIs coming back. But the war changed things. Year-to-date, we are down 8%, worst among EMs. It doesn’t mean it’s time to buy, but FPIs in India love other EMs.”
On policy developments like opening up FDI with China, Trivedi said it was positive but cautioned that details matter. “This is a step in the right direction, but it could create tough competition for local power companies. Chinese products are cheaper, which may help reduce costs, but not all companies will benefit.”
Amid the uncertainty, Trivedi is focusing on long-term structural demand sectors rather than global commodities.
“We are positive on data centers and AI, but mainly the power sector, which is the second highest allocation in our fund after banking and finance.”
Trivedi also emphasized that his strategy focuses on structural changes in companies rather than thematic trends.
“We look for incremental changes — CEO changes, ownership changes, M&A, or subsidiary IPOs. We’ve sold some stocks that have reached their capacity, and that strategy has worked well,” he said.
He added that portfolio reductions have been gradual over the past year, not a reaction to the recent recession.
“This war is right in our neighborhood and it’s affecting the economy. In times like this, you can’t react quickly unless you’re a hedge fund. We’re facing a storm like the financial industry, and hopefully the situation will be resolved soon.” Trivedi said.
Gotham Trivedi
