Largecap stocks may be better placed than their mid- and small-cap peers as investors have already priced in strong earnings growth in the broader market, according to Arihant Jain, portfolio manager for SIF and multi-factor funds at Franklin Templeton India.
While mid- and small-cap stocks are factoring in 20% to 30% earnings growth, large-caps are being valued against more modest 10% to 12% expectations. That leaves greater room for earnings upgrades and a valuation re-rating in large-caps, Jain said. Edited excerpts from a chat:
