Dipan Mehta, Director, Elixir Equities admits to being shocked by the latest correction. “Even I’m perplexed. I used to be very optimistic from Diwali and into the New Yr and anticipated the earnings season to carry good tidings. At the very least in the interim, I’ve been proved fallacious,” he mentioned. Nonetheless, Mehta cautioned towards studying an excessive amount of into short-term market actions, noting that volatility is a component and parcel of fairness investing. He stays optimistic that the present earnings season may transform one of many higher ones seen within the final seven to eight quarters and doubtlessly lay the muse for a recent rally past earlier highs. Whereas markets are but to decisively cross these ranges, he believes 2026 may nonetheless form up as a powerful yr for portfolios, even when buyers must endure a section of turbulence within the close to time period.
On the theme of financialisation of financial savings, Mehta prefers selective publicity moderately than a broad guess on asset administration firms (AMCs). Whereas acknowledging that AMCs stay an excellent long-term story, he believes wealth administration companies provide larger flexibility and resilience. He pointed to the robust efficiency of firms like Anand Rathi Wealth and 360 One, in addition to mutual fund distributor Prudent, as higher performs on this pattern. In line with him, AMCs face intense competitors and periodic regulatory interventions on pricing and commissions, whereas wealth managers profit from diversified enterprise fashions. He additionally flagged stockbroking platforms as an rising alternative, citing Groww’s fast scale-up and its potential to diversify its product choices. That mentioned, Mehta added that he would proceed to remain invested in AMCs and expects one other robust yr for the section.
After a protracted interval of underperformance, Mehta can be turning incrementally optimistic on the IT providers sector. “I get supportive on IT and step by step extra optimistic,” he mentioned, highlighting synthetic intelligence as the following development catalyst. Whereas he’s unsure whether or not AI can instantly drive double-digit development for giant IT providers companies, he believes a number of midcap firms are nicely positioned to profit from this transition. Tata Elxsi’s latest efficiency, aided by a revival in software-defined car initiatives within the automotive vertical, is one such instance. With valuations now cheap, investor positioning gentle, and base results turning beneficial, Mehta sees scope for IT shares to outperform after almost a yr and a half of lagging the market. For conservative buyers, he believes large-cap IT names stay a protected guess, declaring that AI already contributes round 6% to TCS’s revenues and is rising at a wholesome sequential tempo.
Commenting on Infosys’ quarterly efficiency, Mehta described the numbers as largely predictable, stressing that the actual focus ought to be on administration commentary and the contribution of AI-led initiatives. He views software program providers as a long-term play, acknowledging that even when 2026 proves muted, a tipping level pushed by AI adoption may emerge later this yr or early subsequent yr, resulting in an enchancment in development charges.
Trying throughout sectors, Mehta expects earnings restoration to be broad-based. Excluding exporters closely depending on the US market, he believes most domestic-facing industries ought to put up wholesome numbers, aided by a powerful festive and wedding ceremony season. Autos, cement, metals and, over time, IT providers are among the many sectors he expects to do nicely. He’s notably upbeat on metals, citing greater costs and the potential for robust outcomes from firms equivalent to Vedanta, Hindustan Copper, NMDC and Nalco. Banking and NBFCs additionally look like on stable footing, supported by encouraging pre-quarter updates and sturdy enterprise momentum, as seen in Bajaj Finance’s December-quarter efficiency. In Mehta’s view, if earnings proceed to enhance, capital flows—home or abroad—will finally observe.
On Reliance Industries, nevertheless, Mehta strikes a extra cautious notice. He believes the inventory’s outlook is much less about near-term earnings and extra about its evolving company construction. As Reliance more and more resembles a holding firm, the prospect of separate listings for Jio and the retail enterprise raises the opportunity of a holding firm low cost being utilized to the guardian. Whereas the oil-to-chemicals enterprise stays a powerful money generator, Mehta questions whether or not it deserves a better valuation a number of. He argues {that a} formal demerger, permitting shareholders to immediately personal Jio and Reliance Retail, would unlock most worth, although administration has to date proven little inclination to pursue that route. Nonetheless, he concedes that Reliance’s administration has a historical past of peculiar the market and that robust working circumstances throughout its core companies may but translate right into a standout quarter. For now, Mehta’s method stays earnings-focused. Markets could sway unpredictably within the brief time period, he says, however sustained enchancment in company earnings is what finally drives sturdy rallies.
