Investors chasing the strong recent performance of small- and mid-cap stocks risk overlooking the valuation cushion emerging in large caps, according to Shridatta Bhandwaldar, chief investment officer-equities at Canara Robeco Asset Management Company.
While large caps offer a stronger margin of safety, any meaningful rerating will require earnings acceleration in heavyweight sectors such as banking, information technology, FMCG and oil and gas, he said. Bhandwaldar remains constructive on equities after Nifty 500 earnings growth exceeded 15% in the first quarter of FY27, marking a revival after an 18-month earnings downcycle.
