When Public Markets Dip, Where’s the Smart Money Going?

The Sensex is on a rollercoaster, inflation remains sticky, and global tariff tensions are spooking portfolios. In moments like these, cash feels like the only seatbelt. But smart capital doesn’t stand still. It repositions.

With public equities underperforming and IPO pipelines drying up, Indian investors, retail and institutional alike, are asking: Where does defensible growth live in a market that’s shifting underfoot?

Gold? Real estate? Private equity? Or something more agile?

Downturns don’t just expose vulnerabilities, they spotlight resilience. And in India’s dynamic economic landscape, that resilience increasingly lies beyond the NIFTY 50.

Why are Newer Investment Avenues Catching Up?

India’s macro indicators aren’t flashing green. Interest rates remain elevated. Global supply chains are under pressure from tariffs and geopolitical uncertainty and public market volatility is eroding investor confidence.

But sitting on cash isn’t necessarily safer.

History shows that hiding in fixed deposits during downturns can mean missing the inflection point: the early innings of new cycles. Today, investors are instead looking to diversify away from public market cycles by exploring alternative asset classes that offer defensibility, long-term returns, and a different risk-reward equation.

From tangible stores of value to high-growth private ventures, alternatives are gaining mindshare. But not all are equal in resilience or relevance, to India’s current moment.

Mapping Investment Avenues

From tangible wealth to innovation bets, here’s how some of the most prominent alternatives stack up today.

Gold and Precious Metals

Gold continues to hold its appeal, especially during times of inflation and geopolitical uncertainty. It’s deeply rooted in Indian households as a store of value, and its global liquidity makes it easy to enter or exit. It offers psychological comfort and serves as a time-tested buffer in turbulent cycles. India’s consumption, over 800 tons annually, reinforces its status as a reliable fallback.

Real Estate

Real estate provides a blend of stability and passive income, particularly in metro markets like Bengaluru, where IT demand continues to anchor rental yields. With residential markets expanding in Tier-2 cities and commercial spaces seeing renewed leasing activity, it remains a core asset for long-term holders. Investors are drawn to its physicality and the sense of permanence it offers.

Private Equity (PE)

Private equity offers a chance to back mature, cash-generating businesses, especially in sectors like healthcare, manufacturing, and logistics, which remain relatively insulated from consumer sentiment. It’s often viewed as a middle ground between public equities and venture capital, balancing growth with predictability. In India, PE continues to see strong activity, driven by both domestic demand and global capital seeking emerging market exposure.

Venture Capital (VC)

Venture capital thrives not in spite of downturns, but often because of them. Economic pressure accelerates innovation; startups building in AI, fintech, and healthtech are responding to real, urgent needs. Historical data shows that vintages during past crises have delivered standout returns, as capital-efficient founders emerge and valuations correct. For investors with longer horizons and a higher risk appetite, VC offers a front-row seat to India’s next growth wave.

The Trade-Off Spectrum:

Gold = safety. Real estate = stability. PE = cash-flow defensibility. VC = innovation-powered

growth.

Each asset class has a role to play and choosing between them depends on your liquidity needs, return expectations, and investment philosophy. But in the current environment, one segment is emerging as especially dynamic—tech-enabled ventures.

While traditional alternatives offer resilience, tech-enabled ventures bring something different to the table: adaptability. The headlines may be gloomy, but India's tech undercurrent is electric. UPI transactions are at all-time highs, AI adoption is becoming foundational, and digital infra, from ONDC to 5G, is scaling fast.

Here’s the kicker: downturns breed operational discipline. Startups that survive are the ones solving real problems, like automating logistics for kirana stores, enabling low-code healthcare workflows, or using AI to reduce customer acquisition costs.

In fact, tariffs and cost pressures are accelerating AI adoption. Rising input costs mean businesses must optimise or perish; AI and automation aren’t optional anymore. While fewer startups are getting funded, valuations are correcting, and capital efficiency is the new north star.

Translation: It’s a buyer’s market, and the best founders are heads-down building. This is when the next generation of winners is forged.

As a tech-focused fund, we believe this is where defensibility meets asymmetric upside.

When Markets Waver, the Future Doesn’t Wait

From gold’s timeless value to real estate’s reliable yields, and from PE’s stability to VC’s bold ambition, alternatives offer diverse ways to ride out public market storms.

Downturns don’t only prune, they prepare.

If you're rethinking your portfolio, this is your signal. Explore the opportunities that endure.

"Public market headlines change every day. Private market value gets built every decade."