Equity Market Outlook
Long-term outlook remains intact:
Quarterly results were a positive for banking on margins and profitability. Prospects of the pharma sector also appear positive. It is the opposite with IT, as growth outlook appears lukewarm. Sectors that will ride the consumption story, as also auto and real estate offer above-average growth potential.
Large caps continue to appear more lucrative on a risk-reward basis, with small and mid caps trending at a premium.
Equity markets have rallied steeply, and valuations in certain pockets are a matter of some concern. However, from a long-term perspective, Indian markets continue to offer significant opportunities on the back of higher GDP growth from higher earnings, political and policy stability.