Nifty Outlook 2026: Markets continue to trade in a tight range amid concerns around crude oil, inflation and geopolitical tensions, but experts believe the real opportunities are emerging in selective small and midcap themes.
In this detailed discussion, Ashish Chaturmohta and Rahul Shah decode why sectors like AI, pharma CDMO, capital goods, exchanges and brokers could outperform, while also sharing their views on LIC, Page Industries, CG Power, Siemens Energy and more.
Markets Seen Rangebound; Small & Midcaps Offer Better Alpha
Ashish Chaturmohta believes the broader market is likely to remain rangebound due to concerns around the rupee, crude oil prices and inflationary pressures globally. According to him, the Nifty could trade between 23,000 and 24,500 in the near term, with large caps facing limited upside unless foreign institutional investors (FIIs) return aggressively.
He said the real opportunity lies in the small and midcap space, where strong earnings growth, rising capex and improving asset turnover are driving re-rating across sectors.
Chaturmohta highlighted AI, data centres, capital markets and capital goods as some of the strongest emerging themes in the market. He noted that many small and midcap companies in these sectors are witnessing strong capacity utilisation and expansion plans, which could support sustained earnings momentum despite inflationary pressures on margins.
He added that selective stock picking remains critical as alpha generation opportunities are concentrated in specific themes and businesses.
West Asia Crisis Largely Priced In, Says Expert
On the impact of the ongoing West Asia crisis, Chaturmohta said much of the negative impact appears to have already been discounted by the market, especially after the sharp fall in the rupee and spike in crude oil prices.
He believes downside for large caps may remain protected near the 22,500-23,000 zone. If geopolitical tensions ease, the Nifty could move towards 24,500. However, he cautioned that large cap outperformance may remain difficult until FIIs turn buyers again.
Pharma CDMO Space Emerging as Strong Bet
According to him, the growth in CDMO businesses could create meaningful operating leverage and drive earnings growth for these companies over the medium term.
Exchanges, Brokers Seen Benefiting From Capital Market Boom
He said brokerage and wealth management firms could also see re-rating opportunities. Among brokers, he highlighted Angel One, citing its strong market share in both cash and derivatives segments, along with expansion into mutual funds and wealth management.
Capital Goods, Transformers and Semiconductors in Focus
He also remains constructive on CG Power and Industrial Solutions due to its exposure to both transformers and semiconductors. Alongside CG Power, he said BHEL is also showing strong stability and investor interest in the capital goods segment.
Large Private Banks Showing Signs of Bottoming Out
On banking stocks, Chaturmohta said the market still lacks clear strength from large private sector banks, which is keeping the benchmark indices rangebound.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
