Latest news with #GautamDuggad
Time of India
a day ago
- Business
- Time of India
Neither largecaps, nor smallcaps! India Inc's Q4 result season belongs to the middle order
Even as investors debate whether to chase largecap safety or smallcap thrill, Q4 earnings have quietly handed the trophy to a third contender—India Inc's middle-order. Midcaps have emerged as the surprise winners of the March quarter, delivering relatively better numbers across revenue, EBITDA, profit before tax and net profit. Domestic brokerage firm Motilal Oswal said within its universe, midcaps posted a robust 19% YoY PAT growth, beating not just estimates (10% higher than expected) but also the performance of both largecaps (+10%) and smallcaps (a disappointing –16%). The earnings season, once again, proves that resilience and growth are often found in the mid-ranks. Motilal data shows this wasn't a narrow performance. Midcap Metals clocked an 84% YoY jump in PAT, accounting for over a third of incremental profits. Public sector banks in the midcap universe delivered a 39% surge, driving nearly 50% of total PAT growth. Electronics manufacturing services (EMS) continued their hot streak, rising 70% YoY. The quality of results was notable, with widespread distribution of strong growth across several midcap sectors – in several cases better than the largecap counterparts, Motilal's Gautam Duggad said. Also read | Sensex will hit 1.5 lakh by 2030 & 3 lakh by 2035! Raamdeo Agrawal makes big prediction Other sectors that posted strong growth included Capital Goods (+30%), Consumer Durables (72%), and NBFCs – both lending (23%) & non-lending (36%). 'Comparatively, the mid-cap technology sector was subdued, posting a 12% YoY growth (est. 19%), but better than the large-cap peers – which is in line with our long-standing thesis that mid-cap IT is poised to grow structurally above the large-cap IT names,' he said. 'While overall earnings have been ahead of estimates (a welcome departure from the past 3 quarters' outcome of broad earnings misses), the Mid-cap segment has been an unexpected standout surprise – underlining its critical role in throwing up growth leaders for future – thus broadening the market's investable set of companies,' Duggad said. Market experts also point out that as the market capitalisation of midcaps has grown in the last 2-3 years, FIIs are also showing greater interest due to the liquidity factor. Valuations, however, are getting stretched, warns Trideep Bhattacharya, CIO-Equities, Edelweiss Mutual Fund. 'Mid and smallcaps are now trading at a 17–25% premium to their 10-year averages. So, the earnings momentum must continue. If growth lags, these stocks will be in the penalty box.' That calls for stock-picking discipline. 'Where there is a valuation premium, it must be matched with an earnings growth premium. The market is currently unforgiving of any mismatch,' Bhattacharya added. Still, Bhattacharya believes that midcaps can remain in favour for the right investor profile. 'For conservative investors, flexicap funds work. For moderate risk-takers, multicap funds. And for those with higher risk appetite and a 5–10 year horizon, midcap funds are ideal.' Dr. Joseph Thomas, Head of Research at Emkay Wealth Management, says both mid and smallcaps offer better value to the portfolio on a longer-term basis. 'This is because of two reasons. After the corrective downward movements seen in the last three to four months, the valuations are now at reasonable levels. The segment offers better growth and therefore, better price performance,' he said. In short, the earnings strength, sectoral diversity, and growing institutional participation make midcaps too important to ignore. Also read | Rs 15 lakh crore in net profit! India Inc's top 500 cos break records in FY25 despite downgrades ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
CNBC
3 days ago
- Business
- CNBC
India's macro strength and market breadth signal uptrend, says Motilal Oswal
Gautam Duggad, Head of Research at Motilal Oswal Financial Services, says India's macro fundamentals are at their strongest in decades. He expects the Nifty to edge toward 26,000 by the end of 2025, which would also allow enough time for valuations to "cool off". He is bullish on non-banking financials, capital markets, and quick commerce players, though he remains cautious on EVs and IT services. The biggest risk to the equity outlook, he says, will be on the external front.
Economic Times
02-05-2025
- Business
- Economic Times
markets: Can markets defy historical trends and thrive in May amid global challenges?
As the month kicks off, the positive mood seen in April hasn't changed. Foreigners have pumped over ₹38,150 crore in the second half of April after remaining sellers in the first part, helping the Sensex and Nifty gain 5% in April. Also, there has been no adverse tariff related news flow the past few days. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Popular in Markets Tired of too many ads? Remove Ads Mumbai: Among the oldest Wall Street adages is "Sell in May and go away," although stocks haven't really stuck to that predictably dystopian script lately. Instead, risk assets have often advanced in value through the time, however, investors are unwilling to brush aside the old jungle proverb entirely amid the ebb and flow on tariffs, their impact on the US economy, and the simmering summer of discontent in the Kashmir the month kicks off, the positive mood seen in April hasn't changed. Foreigners have pumped over ₹38,150 crore in the second half of April after remaining sellers in the first part, helping the Sensex and Nifty gain 5% in April. Also, there has been no adverse tariff related news flow the past few Wednesday night, Wall Street indices eked out gains, erasing early gains after the US GDP in the first quarter contracted by 0.3% - the first drip since 2022 - raising hopes the US Federal Reserve might cut interest rates sooner. The S&P 500 and the Dow fell over 2% earlier in the day. Indian markets were shut for trading on Thursday for Maharashtra this setting, the market seems poised to be starting trading in May on Friday on a positive note. Moreover, historical data show May hasn't typically been a weak month for Indian markets and have delivered average returns of over 2.5%.But, analysts warn that a runaway rally may be unlikely."I don't see a significant upside at the broader index level in the immediate term," Siddarth, Bhamre, Head - institutional research, Asit C Mehta "At the index level, we might see some trimming, but recent trends don't necessarily support a major correction. In fact, the pattern in recent years shows that May has been delivering positive returns more often than not," he 2013 to 2021, BSE's Sensex logged a nearly nine-year streak of positive returns in the month of May."I believe we might now see the market range between 22,000-22,500 on the lower side and 24,500-25,500 on the higher side," he several earnings already out and more to come, investors are closely tracking how companies are projecting growth in the coming quarters. At the same time, global developments particularly around tariffs and geopolitical tensions are adding another layer of uncertainty.'Going forward, market movement will largely depend on how corporate earnings shape up and how the tariff situation unfolds,' said Gautam Duggad, head of research — institutional equities at Motilal Oswal Financial Services 'Geopolitical tensions, especially any escalation between India and Pakistan, could also impact sentiment, depending on developments at the border. At the same time, expectations around the monsoon will begin to take shape as we approach May,' he added. Suresh Soni, CEO of Baroda BNP Paribas Mutual Fund, said, aid the results have been muted and the guidance cautious so far; but the monsoons are expected to be normal. SECTORS Bhamre recommends investors to park their money in large private banks such as ICICI Bank and HDFC. He also recommends investing in life insurance firms and paint companies. With some of the tariff concerns easing, Duggad suggests considering IT stocks and banks. He also feels, consumer discretionary and industrial appear more attractive now, as there are signs of rising discretionary and consumption spending. Duggad sees stocks such as Indian Hotels, ICICI Bank, Titan and Trent faring well going to Soni, with uncertainty around US tariffs investors should bet on domestic sectors like BFSI, consumer goods, healthcare (like hospitals), and industries such as power, cement, and telecom. In contrast, sectors like IT and metals, which are more exposed to global risks, are seen as riskier noted that the recent market rebound followed an unusual stretch of five consecutive months of negative returns for the Nifty. He said patience will be the key to navigate this market. 'As Charlie Munger said: 'Big money is not in the buying or selling, but in the waiting. Stay invested for the long-term and let the compounding work for you,' said Soni.
