Citibank India CEO K Balasubramanian highlights that India must better align with the global artificial intelligence boom to draw significant foreign investment. While the bank's institutional business is performing well, foreign investors are prioritizing tech-heavy markets. The bank also observed that market valuations have become more manageable, with Nifty forward earnings multiples shifting from 24-25 times down to 20-21 times, signaling a healthier environment for new public listings.
India needs to craft a stronger narrative around artificial intelligence to effectively compete for foreign investment on the global stage, according to Citibank India CEO K Balasubramanian. While the country remains an attractive destination for many, investors are currently showing a clear preference for markets that offer high-conviction exposure to the global AI boom, such as the United States. To change this perception, India may need to demonstrate deeper integration into technology-driven growth or offer returns that clearly justify the investment risk compared to other international options.
Citibank India, meanwhile, has reported strong momentum since its departure from the consumer banking space three years ago. The bank has successfully refocused its operations on institutional clients, achieving a 76% revenue increase between March 2023 and March 2026. This period of transition has been marked by a 16% compound annual growth rate in net income and a 16.3% expansion in its balance sheet, which now stands at ₹3.14 lakh crore. The bank's strategy has prioritized asset quality and high-growth segments, moving away from the high-cost deposit gathering model typical of retail banking.
Despite the global capital flow challenges, the domestic IPO market continues to show promise. The bank is currently working on several large transactions, including three to four deals worth over a billion dollars expected to close before the end of the year. A broader pipeline of over a dozen companies is also being processed. Market experts at the bank noted that the market has undergone a healthy price correction, with Nifty forward earnings multiples cooling from the 24-25 times range to a more sustainable 20-21 times. This valuation adjustment is seen as a supportive factor for companies capable of maintaining consistent mid-to-high-teens earnings growth.
Looking ahead, Citibank is positioning itself for future opportunities through its expanded operations in GIFT City, where assets have reached $2.5 billion. This strategic focus is partly designed to capture cross-border investment flows as the bank prepares for the expiration of its non-compete agreement with Axis Bank in 2027. Moving forward, investors will be tracking whether potential policy shifts, such as adjustments to long-term capital gains tax structures or the finalization of major trade agreements with the UK and EU, act as catalysts for bringing more durable foreign direct investment into the Indian market.