Stories
Indian Markets Could See Another 10% Correction Despite Earnings Growth Says Deepak Shenoy
- •Deepak Shenoy warns that Indian markets could face another 10 percent correction due to subdued investor sentiment and fund flows.
- •Early corporate earnings show healthy growth across midcaps, smallcaps, and largecaps despite weak market prices.
- •Banking stocks offer long-term opportunities with smaller banks recording strong double-digit deposit growth.
- •Indian IT services firms are expected to benefit later in the AI adoption cycle as businesses implement and manage solutions.
Key Questions Answered
Capitalmind Mutual Fund CEO Deepak Shenoy stated that Indian markets could face another 10% correction despite early corporate earnings indicating healthy growth. He attributed this weakness to subdued investor sentiment and fund flows rather than a deteriorating earnings outlook.
Deepak Shenoy noted that the banking system remains in reasonably good shape with credit and deposit growth while bringing down non-performing assets. Smaller lenders have recorded strong double-digit deposit growth, and some public and private sector banks are trading at reasonable valuations near or below book value.
Deepak Shenoy explained that Indian IT services companies are likely to benefit from artificial intelligence later in the cycle as AI transforms into infrastructure. Their growth opportunity emerges when businesses need implementation, process management, and troubleshooting support for AI-based solutions rather than building foundational models.
