Shah said the Nifty is likely to remain range-bound between 23,150 and 24,000, while the broader market could continue to deliver returns. He expects the small-cap index to climb to 20,000 and beyond over the next quarter, implying a further 10-12% upside from current levels.
He noted that while the Nifty has underperformed over the past several years, smaller companies have generated strong returns. According to Shah, around 1,700 stocks out of roughly 2,000 listed on the NSE continue to perform, while weakness has been concentrated among large-cap stocks.
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Shah said investors should focus on themes rather than individual stock selection. He highlighted pharma, chemicals, PSUs and real estate as sectors that could continue to perform well over the coming months.
Shah believes the correction phase in the real estate sector has largely ended after a sharp decline over the past 18 months. He expects the sector to deliver returns over a longer investment horizon.
He suggested that investors focus on leading developers across key property markets such as Mumbai, Delhi and Bengaluru, arguing that the sector could benefit from a recovery in economic activity and consumption trends.
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Shah also remains constructive on Indian information technology stocks after a prolonged correction. He said concerns around artificial intelligence (AI) disrupting India’s technology services sector are largely reflected in current valuations.
According to Shah, the Nifty IT index is approaching a key support zone and may gradually recover, helping reduce the market’s dependence on heavyweight stocks and large private-sector banks.
For the full interview, watch the accompanying video
Shah said the artificial intelligence-driven rally in the United States and several Asian markets could continue. While India may lag global peers in relative performance, he expects the global equity bull market to remain intact.
Shah continues to favour public sector enterprises. He expects the PSU segment to benefit from government divestment plans and dividend yields, projecting potential gains of 25-30% over a 12-18-month period.
He also reiterated a positive outlook on the Adani Group, saying the conglomerate could see stronger performance in the coming months.
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