Kotak AMC Favors Large-Cap, Stock-Specific SMID Investments

Quick Summary

• Shibani Sircar Kurian from Kotak AMC discusses market conditions, noting a significant number of stocks are trading 50% lower than their 52-week high, indicating some valuation comfort.
• The Nifty index has corrected around 13-14% from its highs, with mid and smallcap indices experiencing even greater corrections.
• Largecaps are seen as offering better risk-reward compared to mid and smallcaps due to more reasonable valuations.
• The market’s volatility is attributed to both global factors (tariffs, monetary policy) and domestic issues (corporate earnings slowdown).
• Corporate earnings are expected to improve gradually by FY26 despite current uncertainties.

indian Opinion Analysis

The current analysis underscores the importance of focusing on largecap stocks for those seeking stable investment opportunities amidst volatile markets. With valuations trading below long-term averages and global factors causing significant outflows from emerging markets like India, investors may find largecaps relatively safer. Meanwhile, cautious optimism exists regarding corporate earnings recovery in the coming years. Investors looking at mid and smallcap opportunities should adopt a bottom-up approach considering individual stock potential rather than broader sector movements.

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!Shibani Sircar Kurian