Where Is The Next Big Opportunity? Market strategist Asit Bhandarkar maps pockets of growth

# Why markets are strained despite strong GDP

# The investment stance: bottom-up and stock-specific

Asit Bhandarkar, Senior Fund Manager — Equity at JM Financial AMC, frames the current market as one where macro strength coexists with sectoral and stock-level divergence. That suggests a bottom-up approach: focus on companies with visible earnings momentum, pricing power or market-share gains rather than broad index bets.

# Sectors grabbing allocation

Bhandarkar highlights a handful of areas getting heavier weight in his portfolio:

• Mid-cap IT: smaller, niche IT services companies with faster growth profiles are preferred over large, mainstream IT names.
• Auto ancillaries: beneficiaries of the EV transition, rising exports and India's role in global auto supply chains.
• NBFCs: improving credit demand, better underwriting discipline and operational leverage are driving interest.

These sectors are chosen for company-level growth prospects rather than a blanket sectoral endorsement.

# Why mainstream IT takes a backseat

Mainstream IT still provides cushion to markets, but Bhandarkar favors mid-sized IT firms because they offer clearer, higher growth trajectories. The shift is tactical: when the market rewards revenue and margin expansion at the company level, mid-cap tech names can outperform large-cap incumbents.

# Market headwinds to watch

Three external variables are highlighted as the main risk drivers:

• Crude oil: higher oil raises input costs and can dampen consumption and margins for sensitive sectors.
• Global bond yields: rising yields can reduce risk appetite and prompt re-rating of equities.
• Geopolitical tensions: increase risk premia and can trigger episodic selling.

Foreign institutional investor flows and quarterly earnings outcomes also shape short-term direction.

# Practical implications for investors

Adopt a stock-first process. Look for companies with:

• Durable demand drivers or niche capabilities.
• Tight balance sheets and disciplined capital allocation.
• Visible earnings upgrades or margin recovery potential.

Use sector allocation sparingly. The environment rewards concentrated, research-driven positions rather than equal-weight bets across cyclical themes.

# What to expect next

Expect continued market divergence: macro resilience will coexist with episodic volatility driven by oil, yields and geopolitics. That creates windows for active managers and stock pickers to add value. For investors, the operative play is to tilt into proven mid-cap growth names and select financials while avoiding broad assumptions about large-cap leadership.

# Final practical checklist for investors

• Reassess holdings for oil and rate sensitivity.
• Prioritise names with clear earnings momentum.
• Keep position sizes aligned with conviction and liquidity.
• Monitor FII flows and quarterly earnings for short-term volatility triggers.