After two years of largely flat returns, the Nifty may be approaching an inflection point as valuations, FII positioning and sector leadership begin to shift. JioBlackRock CIO Rishi Kohli says largecap stocks have de-rated by around 10%-15% from their long-term averages, while Indian banks have significantly underperformed global peers despite stronger growth prospects.
The next phase may not be a broad-based rally. Kohli expects the market to remain volatile, with IT still facing a difficult medium-term outlook, while banks and other largecap sectors could eventually pull the benchmark higher. “If banks and a few other heavyweights start performing, the broader indices should do well,” he said.
