Earnings momentum, banks and discretionary consumption to drive market upside: Tushar Bohra

Markets may be on the verge of a turnaround as earnings momentum is set to accelerate, according to Tushar Bohra, who shared his insights on sectoral trends and portfolio positioning in an interview to ET Now.

“Yes, so in fact, if you see last few quarters earnings have been on the Nifty a bit soft. Relatively earnings growth has been much lesser in the last say maybe four-five quarters. I expect going forward earnings momentum should pick up substantially from here. So, quarter on quarter we are likely to see the momentum be much stronger and over the next couple of years I would expect possibly double-digit earnings CAGR on the Nifty. So, markets being a slave of earnings, likely that as earnings momentum picks up, market should also see some kind of a decisive move, but maybe we are still a few months away from that, another six to nine months we might see more volatility possibly led more by global factors and then as the earnings start to be visible, the earnings growth starts to be visible, we will see maybe another round of upside in the markets,” he said.

Bohra emphasized that India remains a stock-picker’s market, with only select pockets outperforming in the last year. “I would prefer domestic cyclicals, domestic consumption over exports oriented sectors broadly right now. Banks and NBFCs should do very well from here. We also think that power and utility space, energy space we might see another round of upside. Most of the names in that sector have been relatively subdued in the last say maybe 6 to 9 months, maybe last 12 months. I expect maybe another round of upside in that space,” he added.

He also highlighted consumer discretionary and pharma as areas of interest. “We as a house are increasingly bullish on discretionary consumption. You would remember, I mentioned spirits the last time I was on your show, and we continue to like that space. In fact, interestingly, if you see the last quarter, we have seen very-very interesting developments in the IP space… alongside CDMO, IP is another space which we continue to track and be bullish on.”

On banks and NBFCs, Bohra said, “RBI in this last one year has in a systematic series of steps done a lot to improve liquidity in the entire economy. Going forward we will see a lot more risk taking by the banks. We will see a lot of lending activity pick up. Overall we expect banks and NBFCs will continue to lead the rally.”

Regarding metals, Bohra stressed a selective approach: “So long as the uncertainty continues globally, we will see volatile moves in the entire metal space. We will probably remain stock specific there.” With earnings growth, domestic consumption, and strategic sector bets driving market optimism, investors may find opportunities amid a selectively bullish landscape.