Harish Krishnan sees opportunity in block deal wave, stays selective

Harish Krishnan, Co-CIO and Head of Equity at Aditya Birla Sun Life AMC, which manages $3.2 billion in assets as of May 31, 2025, noted a surge in block deals driven by private equity, venture capital, and promoter activity, which has added significant supply pressure to the market. “We are talking in aggregate of ₹50,000-70,000 crore happening in a fortnight,” he said, adding that the fund has been highly selective in participating in these deals.

“We do take such liquidity opportunities as an option to top up” in stocks we already like, and in some new cases with limited prior exposure, he said.

The fund house has been largely fully invested for some time, and raised equity exposure significantly during the January-March correction. Krishnan explained, “From about 38-40% net equity, we are now at about 75% net equity” in asset allocation products.

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Aditya Birla Sun Life AMC has been actively increasing allocation in private sector banks, as well as sectors like cement, metals, materials, and chemicals. Pharma exposure has risen, particularly in CDMO and diagnostics, while recent tech corrections have also prompted selective additions.

Krishnan expects stronger corporate earnings in the second half of the current fiscal year and remains constructive on equities over a 2–3 year view. He cautioned that recent rapid market gains might lead to short-term consolidation. “A lot of good things have got priced in very quickly,” he said, but emphasised, “This is a market that needs to be bought on dips rather than sell on rise.”

Commenting on global currency trends, Krishnan pointed to a shift in the outlook for the US dollar. “There is an equal chance that the rupee can go towards 80 and maybe even 75,” he said, noting that expectations of a stronger dollar have now shifted toward a possible weakening. If the dollar index (DXY) drops to 90 or 85, it could strengthen the rupee in the medium term.

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Krishnan said the insurance sector may be set for a turnaround after five years of underperformance. “There have been multiple flux of regulations… but the bigger firms have become far bigger,” he noted. He remains positive on the sector’s fundamentals and believes it presents “a very good case for value creation to emerge over the medium term.” The AMC currently holds overweight positions in the space.

For the full interview, watch the accompanying video

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