Mumbai, Oct. 8 -- Brokerage JP Morgan on Thursday said that it is more bullish on the Indian small- & mid-cap space compared to the large-cap segment & placed the information technology sector in the "underweight" category.
It said high-growth themes, including capex, modern manufacturing and artificial intelligence or data centres, are concentrated in the small- and mid-cap space rather than the large-cap space.
"We expect small- and mid-caps to continue outpacing large-caps in earnings growth, as the most compelling high-growth themes - capex, modern manufacturing, and AI/data-center - are concentrated in these segments," it said. The brokerage said it is overweight on sectors, including financials, consumer discretionary, industrials, healthcare and materials & underweight on the IT.
For the Nifty-50 companies -- almost all of them being large caps, the brokerage expects a median revenue growth of 14 per cent and a post-tax profit of 15 per cent for the numbers to be reported for the September quarter.
A slew of factors, including a 15 per cent growth in GST collections, manufacturing PMI averaging higher and non-food bank credit growth at an average of 19.2 per cent, point to strength in economic activity in the September quarter.
The key events to watch include developments in the US-Iran ceasefire, the IPO pipeline and primary market supply, progress on the India-US trade deal and the tariff trajectory, which will include how the threats of Russia-linked 100 per cent duties play out, and also the implementation of the deals with the EU and the UK, it said. RBI's rate hikes, liquidity conditions, food inflation and the pace and spatial spread of the South West monsoon also need to be monitored, it added.
Published by HT Digital Content Services with permission from Millennium Post.