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On this page

1. Market Strategy and Investment Philosophy

  • 1. Market Strategy and Investment Philosophy
  • 2. The Banking Sector: A "Four-Positive" Thesis
  • 3. Real Estate and Urban Housing
  • 4. Thematic Plays: Defense and Digital
  • 5. Macroeconomic Forecasts (FY26–FY27)
  • 6. Risks and Underweight Sectors

On this page

  • 1. Market Strategy and Investment Philosophy
  • 2. The Banking Sector: A "Four-Positive" Thesis
  • 3. Real Estate and Urban Housing
  • 4. Thematic Plays: Defense and Digital
  • 5. Macroeconomic Forecasts (FY26–FY27)
  • 6. Risks and Underweight Sectors
Equity/March 11, 2026/2 min read/youtube.com

Jefferies India's Mahesh Nandurkar On Where To Invest In Indian Stock Market Now | NDTV Profit

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1. Market Strategy and Investment Philosophy

  • Bottom-Up Focus: The market is currently characterized as a "bottom-up" environment rather than a top-down story. Broad index returns are expected to be in the high single digits over the next 12 months, making individual stock selection critical 00:00:44.
  • Time Horizon: Investors are advised to maintain a one-year view to navigate near-term geopolitical volatility and war-related disruptions 00:01:33.

References

  1. Original source (youtube.com)

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Reading

Published
March 11, 2026
Read time
2 min read
Progress0%
  • Valuation Context: Despite recent corrections, India remains expensive with P/E multiples above 20x one-year forward earnings, which is high compared to emerging market peers 00:15:01.

  • 2. The Banking Sector: A "Four-Positive" Thesis

    Mahesh Nandurkar identifies four key pillars supporting the banking sector despite current stock price pressure:

    • Credit Growth: A significant rebound from 9% (May/June of the previous year) to over 13% currently 00:03:19.
    • Net Interest Margins (NIM): Margin pressure is expected to ease as the cycle of 125 basis points in rate cuts is now in the past 00:04:19.
    • Asset Quality: Overall credit quality remains stable, with only minor concerns in the microfinance segment 00:04:38.
    • Opportunity: High conviction in Tier-2 and Tier-3 banks as valuation-attractive alternatives to top-tier names 00:05:12.

    3. Real Estate and Urban Housing

    • Market Share Consolidation: The top 8–10 listed developers are outperforming the broader industry by gaining significant market share 00:07:44.
    • Valuation Disconnect: While pre-sales for listed firms are projected to rise by 20% in FY26, stock prices have corrected by 25%, leading to a total valuation compression of nearly 45–50% 00:08:10.
    • Insider Confidence: Promoters are increasingly buying their own shares from the open market, signaling strong internal confidence in current price levels 00:08:25.

    4. Thematic Plays: Defense and Digital

    • Defense Capex: A high-conviction theme with budgeted growth of 16–17%. Historical spending has peaked at 1% of GDP, and current geopolitical trends suggest India may reach or exceed these levels 00:12:38.
    • E-Commerce/Quick Commerce: Favor is shown toward segments like food delivery and quick commerce, which are viewed as resilient to AI-driven disruption compared to other tech sectors 00:11:28.

    5. Macroeconomic Forecasts (FY26–FY27)

    • Nominal GDP Growth: Expected to rise from 8% in FY26 to approximately 10–10.5% in FY27 00:06:43.
    • Corporate EPS Growth: FY26 is projected at 8–9%, with an acceleration to 13–14% in FY27, representing a 4-percentage-point improvement 00:06:16.
    • Inflation: RBI's CPI forecast for FY27 is above 4%, which will likely drive higher nominal growth numbers 00:03:58.

    6. Risks and Underweight Sectors

    • Sectors to Avoid: Jefferies is currently underweight on IT, FMCG (Consumer Staples), and broad-based Industrials 00:15:45.
    • Budgetary Crowding Out: High defense spending may "crowd out" government expenditure on other traditional infrastructure projects 00:16:11.
    • Foreign Sentiment: India’s corporate EPS growth is currently lower than the broader emerging market average, which may deter foreign institutional investors (FIIs) 00:15:27.

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