Helios Capital's Dinshaw Irani has warned that investors should prepare for a period of heightened volatility, with “no place to hide” as global and domestic risks escalate. Irani, who has raised cash levels across Helios portfolios to around 10–11%, said the fund is in no hurry to deploy capital amid growing signs of fragility across both global and domestic markets.
"The market is in a fragile state right now, and with growing geopolitical tensions and market reactions to shifting tariff policies, there will be no place to hide," Irani said. He added that equity markets are reacting emotionally to the shifting narrative around tariffs and macro data, unlike the more stable signals coming from the bond and currency markets. With the US dollar firming up and long-term bond yields pushing past 5%, Irani believes investors are being forced to reprice risk, especially in export-heavy portfolios.
Dinshaw Irani (Image source: NDTV Profit)
Helios has trimmed exposure to export-oriented companies, particularly in sectors that were already stretched on valuations. According to Irani, even the mere anticipation of tariff action is hitting demand visibility. He expects this to worsen if the US-China trade standoff drags on through multiple quarters.
The fund has also reduced its net long position from the earlier 60–65% range, reflecting a more defensive approach. "We are not in a rush to invest," he said, adding that near-term opportunities are limited and the global setup could remain adverse for some time.
Banks, Hospitals, Hospitality Among Key Bets
Despite the defensive stance, Irani flagged select pockets where capital has been rotated. Helios remains overweight on private sector banks and quality non-banking finance companies, citing their short lending cycles and ability to withstand volatility better than public sector counterparts.
Wealth management firms are also on the radar, driven by rising per capita income and growing demand for financial planning services. Within healthcare, Irani sees scope in quality hospital chains given the limited availability of high-standard facilities. He also pointed to the hospitality sector as a surprise outperformer, with room rates surging amid rising travel demand.
On the other hand, autos and technology services were avoided, largely due to structural disruptions and margin compression risks. Registrar and agency services were also seen facing pricing pressure amid increased competition.
Muted Earnings, Domestic Plays May Hold Up
On fourth quarter earnings, Irani does not expect any meaningful uplift for markets. While banks and a few service-led pockets may deliver, most other sectors—including consumer staples—could underperform. He pointed to early indicators from global IT services giants suggesting a slowdown in decision-making and project closures.
Domestic sectors may hold up better in relative terms, but only marginally, he cautioned. The broad-based weakness across manufacturing and exports suggests that “cash is king” may remain the default approach for institutional investors through the near term.
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