When Indian markets corrected by nearly 11% in March, most analysts braced for panic. What they got instead was the opposite. Equity mutual fund net inflows surged from Rs 26,000 crore to nearly Rs 40,000 crore, a jump of 50%, right at the moment markets were falling hardest. SIP contributions also climbed, rising from Rs 29,000 crore in February to approximately Rs 32,000 crore in March.
For Sandipan Roy, CIO at Motilal Oswal Private Wealth, this tells you everything about how Indian investors have evolved. “Indian investors of 2026 are no more the investors of 2008 or 2020,” he said in an interview with ET Now. They are savvier, calmer, and far more deliberate with capital.
Asset allocation has gone mainstream
Perhaps the most significant shift is that asset allocation — long a staple of wealth management presentations — has become a genuine household practice. Multi-asset allocation funds as a category have now crossed Rs 2 lakh crore in AUM, pulling in Rs 5,000 to 6,000 crore in net inflows every month.
March was also the 11th consecutive month of net inflows into gold ETFs. International funds saw their mutual fund AUM grow from Rs 25,000 crore to nearly Rs 38,000 crore, with roughly Rs 500 crore flowing in monthly. LRS data through December 2024 showed that Indians invested $1.77 billion in offshore debt and equity — a 90% jump over the same period the previous year. Overseas real estate investments grew 105%.
How should you invest right now?
Roy’s framework for 2026 is built around moderation. His team’s call from January was simple: there are no extreme excesses in the market, but no deep negatives either. Scale up when sentiment turns too pessimistic, pare back when it gets too optimistic, and hold a neutral asset allocation through the year.
For a balanced investor, Roy recommends roughly 30% in largecaps, 30% in mid and smallcaps, 20% in international funds, and 20% split between gold and multi-asset funds. Notably, his firm is currently overweight on mid and smallcaps relative to largecaps — a positioning that has paid off as smallcaps have outperformed during the recent market rebound.
Private markets are no longer a niche
Alternative investments have moved from the fringes to the core of HNI and ultra-HNI portfolios. Category II AIFs saw commitment amounts by December 2024 already surpass the total collected through all of FY25. Liquidity events and wealth creation in the broader economy are feeding capital back into private equity and private credit vehicles. Significantly, several private equity funds that previously relied only on offshore limited partners are now actively raising domestic capital — a trend Roy views as strongly positive for the industry.
Two sectors for the long haul
When asked about sector bets, Roy pointed firmly to two structural stories: defence and capital markets.
On defence, he argued that in a world of rising geopolitical uncertainty and deglobalisation, nations are investing heavily in self-reliance. India is no exception, with record defence acquisition approvals coming through over the past year. While order books stretch five to six years out, Roy sees this as a long-term holding, not a short-term trade. Motilal Oswal was also the first fund house to launch a dedicated defence index fund.
Capital markets as a sector — brokerages, exchanges, wealth managers, and asset managers — stand to benefit directly from India’s growing financialisation and the continuing shift of household savings into market instruments.
Both, he believes, are stories built to last well beyond any near-term market noise.