Financials are ready for take-off
Seksaria highlighted that lenders initially saw pressure on net interest margins (NIMs) following rate cuts. But with NIMs now bottoming out and asset-quality concerns easing, the sector is well-positioned for strong earnings. “Most asset-quality issues were temporary. With valuations still reasonable, BFSI will take the lead in the rally,” he said.
Consumption recovery still patchy but set to improve
While on-ground consumption sentiment remains mixed, Seksaria sees visible tailwinds from GST cuts, income tax relief and lower borrowing costs. These factors, he said, will put more disposable income in consumers’ hands and should revive demand over the next few quarters.
Sectors to be cautious about
Despite the broader market hitting new highs, particularly the Nifty Bank, Seksaria remains cautious on two pockets:
1. Infrastructure & Capital Goods
Seksaria expects a slowdown in government capital expenditure, driven by lower tax collections and budget constraints. “Infra companies struggle when order books don’t grow. I would stay underweight.”
2. Global Cyclicals
He also prefers to avoid metals and energy, given global uncertainties and slower international demand cycles.
Bottom Line
With financials stabilising, consumption likely to recover and macro tailwinds in place, the market’s next leg may be driven by BFSI and select consumption names—while infra and global cyclicals may require a more cautious approach.