Currency fluctuations, commodity prices, labour cost to impact corporate earnings in FY23, says Aditya Birla Sun Life AMC MD & CEO A Balasubramanian

Aditya Birla Sun Life Asset Management Company's Managing Director and Chief Executive Officer A Balasubramanian decoded the market outlook for the financial year 2022-23, fourth-quarter corporate earnings, and the trajectory of commodity prices in an exclusive conversation with Zee Business. 

According to Balasubramanian, the corporate results have so far been good in FY22, though the economic dynamics have changed globally on the back of Russia-Ukraine crisis. This in-turn has pushed the overall commodity prices higher.  

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The chances of corporate earnings being up and down during the March-end quarter are mainly on the back of currency fluctuations, escalation in commodity prices and labour costs, among others, he said. 

The MD and CEO suggests a higher focus on guiding numbers and outlook of the company than their quarterly earnings. As the commodity prices cool off, the results and overall companies performance will improve, he reasoned. 

FY 23 मार्केट आउटलुक

मार्च तिमाही में उतार-चढ़ाव संभव...ब्याज दरों में बढ़ोतरी होने की उम्मीद: ए बालासुब्रमण्यम, MD & CEO, AB सनलाइफ AMC

#AdityaBirlaSunLifeAMC @MFBALA @abslmf @deepdbhandari pic.twitter.com/jBqfZeLyJG

— Zee Business (@ZeeBusiness) April 18, 2022

Balasubramanian believes that the softening of the commodity prices would happen in the same manner they have risen. He explained further that the higher commodity prices are mainly due to supply-chain and logistics issues, also contributed by unevenness of demand and supply in the market. 

The economic model going forward would undergo a major change, globally, the MD & CEO said. 

On the interest rates front, Balasubramaniam said that the expectations of a hike in interest rates would continue amid rising inflation. The Reserve Bank of India, unlike global peers, didn’t change the key interest rates, however, changed its stance.  

These interest rates don’t impact the overall economy, but do matter on an individual basis, he pointed out. 

On the equity markets front, Balasubramaniam suggested investors accumulate good quality stocks ahead of Q4 numbers amid uncertainty in the market and also pointed out that this is the right time to enter given the selling pressure in benchmark indices.