Trideep Bhattacharya, speaking to ET Now, highlighted the resilience of corporate India despite geopolitical uncertainties affecting the March quarter earnings. However, he anticipates a modest downgrade of 2-4% in FY27 earnings due to rising oil prices and other external pressures.
Bhattacharya foresees the June quarter as particularly challenging for Indian companies, with elevated fuel prices and a delayed monsoon impacting financial results. The West Asia conflict might further exacerbate this situation, with potential spillover effects into the September quarter.
Despite these challenges, Bhattacharya believes much of the anticipated weakness is already reflected in equity markets, which have corrected between 5% and 10% from their peaks. Any further deterioration, especially into the September quarter, could pose new concerns for investors.
“The fundamentals will get worse before they get better.”
Trideep Bhattacharya, speaking to ET Now
In the technology sector, Bhattacharya's fund house remains slightly underweight on IT stocks, although not bearish. He sees artificial intelligence as a significant technological transition, with Indian IT firms playing a more substantial role as AI adoption progresses.
Bhattacharya also identifies financials as an attractive sector, expecting credit growth to accelerate from 8-10% to 14-20% over the next six to 12 months. He also sees opportunities in capital goods and renewable energy, driven by India's focus on energy security.
Background
The global economic landscape has been fraught with uncertainties, particularly due to geopolitical tensions and fluctuating oil prices. These factors have historically impacted corporate earnings and market stability, making Bhattacharya's insights particularly relevant for investors navigating these turbulent times.
For investors, the message is clear: while near-term earnings may face pressure, structural themes such as financial sector growth, energy security, and AI-driven IT expansion offer long-term opportunities.
