Turnaround In Q1 Or Q2? This Market Experts' Bets Differ From JPMorgan — Here's How
While Vikas Khemani agreed with JPMorgan on the pace of earnings growth in the current fiscal, he differs in terms of the quarter-specific turnaround.
Days after global brokerage JPMorgan provided a bull case scenario for the NSE Nifty 50 benchmark of 30,000 in the next nine months, Vikas Khemani, founder of Carnelian Asset Management & Advisors Pvt., said that he believes India's corporate earnings will grow 14-16% in the coming quarters.
While the D-Street expert agreed with JPMorgan on the pace of earnings growth in the current fiscal, Khemani differs in terms of the quarter-specific turnaround. Speaking to NDTV Profit in an exclusive interview on Monday, Khemani said he is not placing any bets in the first quarter (Q1FY26).
On the other hand, Rajiv Batra, chief India equity strategist, head of Asia and co-head of EM equity strategy, JPMorgan told NDTV Profit last week that the April-June quarter will prove to be the 'turnaround' quarter for India's earnings growth, adding that it will serve as 'period of transition' for the market, which has not yet priced in its positive factors.
Not Betting On Q1
Speaking to NDTV Profit, the market expert said that the upcoming second quarter of current fiscal will be when investors should look for 'directions'. "Q1 may not be a critical decisive factor for earnings growth. I won't bet too much on Q1 as it was mired with US tariff-related uncertainty and businesses were impacted over trade deals," he said.
Coming to sector-specific picks, Khemani said one can't get a lot of surprises in the IT sector. "We take a structural point of view on IT. We don't play in largecap IT companies. Identifying the right winner from a directional perspective is far more important," he added.
However, according to the expert, the Indian IT will not be a high growth sector, especially in the largecap space in the current fiscal. On the other hand, Khemani has been bullish on the banking and NBFC sector amid the fresh liquidity push in the financial sector.
'Overweight' On Banking, NBFCs
The founder of the asset management company told NDTV Profit that the Reserve Bank of India's liquidity infusion will reflect positively on earnings in the next couple of quarters. He has been overweight on the sector for the last 6-8 months ever since the RBI Governor started cutting interest rates.
"Liquidity has direct impact on banks and NBFCs, so we have been overweight on the sector. The fundamental message from the RBI Governor's decisions are that his policies will be growth oriented," he said. According to the market analyst, it is the "job of a banking regulator to give a boost in the economy when needed" and to "curtail when it is overheated", especially during times of global uncertainty.
