The recent correction triggered by geopolitical tensions and risk-off sentiment may have dented investor confidence, but as equities look to bounce back after the Iran-US peace deal, Ajay Srivastava, Managing Director at Dimensions Corporate Finance Services believes Indian stocks are still overhauled in several pockets.
Speaking to NDTV Profit, Srivastava argued that the challenges in the Indian market is not limited to the Middle East conflict. They stem from deeper concerns surrounding valuations that persisted for years.
“Our story of underperforming is not from the war. It's much before that. Even today, our valuations are, in most cases, beyond belief," he said.
He pointed to several sectors where stocks continue to trade at lofty earnings multiples despite a prolonged period of market underperformance.
“We have got PEs of 70, 80. I wouldn't buy a PE of 80 today,” he said, noting that even some global technology leaders trade at lower valuations.
While the recent market decline has led some investors to call for a broad-based buying opportunity, Srivastava cautioned against taking a blanket view on Indian equities.
“India is a treacherous market. It's not a clear-cut market where you buy, sleep over it and get good returns over five years," he said.
Instead, he believes investors need to be highly selective and focus on sectors where earnings growth remains strong and valuations are reasonable. Despite his concerns on valuations, Srivastava stressed that he is not bearish on India as an investment destination.
“I'm not negative India at all. I'm just saying you've got to be careful where you invest in India,” he said.
Among the areas he continues to favour are automobiles and contract drug manufacturing. “Auto is a very good story. CDMO is a very good story of India,” Srivastava concluded.
ALSO READ: Stocks To Buy: Check Kush Bohra's Top Picks Of The Day | June 16, 2026
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
