{"id":329880,"date":"2025-08-09T06:36:12","date_gmt":"2025-08-09T06:36:12","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/329880\/"},"modified":"2025-08-09T06:36:12","modified_gmt":"2025-08-09T06:36:12","slug":"markets-cautious-on-it-bullish-on-hospitals-and-consumption-themes-mayuresh-joshi","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/329880\/","title":{"rendered":"markets: Cautious on IT, bullish on hospitals and consumption themes: Mayuresh Joshi"},"content":{"rendered":"

“In times like these, rather than getting shaken out, if you continue your systematic investments, they will yield results over time. So yes, while Trump tariffs<\/a> took center stage this week, the markets<\/a> have responded very maturely,” says Mayuresh Joshi<\/a>, Head Equity, Marketsmith India.<\/p>\n

How did you view the entire week? Yes, we faced a lot of challenges. It was a tricky week with so much news flow coming in from global markets. It was difficult to digest. But one thing I\u2019d say \u2014 Indian markets now behave quite maturely, and we\u2019re seeing a rational approach.
<\/strong>Mayuresh Joshi:<\/strong> Oh yes, it was a roller-coaster week \u2014 one of the wildest rides you\u2019d experience in any water park! The events that transpired, especially around Trump\u2019s tariffs, led to the correction we\u2019re currently witnessing.<\/p>\n

However, the market\u2019s response has been quite mature, as you rightly pointed out. There’s been no panic or abrupt sell-off. A large part of this resilience is due to strong domestic flows. The Indian retail investor seems to have figured out the secret sauce \u2014 staying invested for the long term. In times like these, rather than getting shaken out, if you continue your systematic investments, they will yield results over time. So yes, while Trump tariffs took center stage this week, the markets have responded very maturely.<\/p>\n

There\u2019s so much happening in both global and domestic markets. The tariff jitters continue, and uncertainties persist. On the domestic front, the first half of earnings wasn\u2019t great, but the second half is showing promise. FIIs haven\u2019t returned yet, so a clear direction for the domestic market is missing.<\/p>\n

Do you see the upcoming festive season as a ray of hope \u2014 particularly for consumption, autos, hotels, tourism, etc., with festivals starting from Raksha Bandhan?
<\/strong>Mayuresh Joshi:<\/strong> Oh yes, that\u2019s the hope. Both urban and rural consumption are expected to make a strong comeback in the second half. For urban India, tax cuts are a booster. For rural India, better monsoons and higher farmgate prices for cash crops are leading to better realizations and income.
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As a result, consumption is expected to pick up significantly. That\u2019s one leg of GDP growth. The second is investments \u2014 with government capex moving at a fast pace and private capex showing early signs of revival.The third leg, FDI and FPI<\/a> flows, is lagging currently \u2014 mainly due to global uncertainties like Trump\u2019s tariff policies and weak earnings. However, if earnings start reviving and the tariff noise settles over the next 3\u20136 months, I don\u2019t see why FDI and FPI flows won\u2019t return.India, in a global context, is still a domestic-driven consumption economy. So even if investors are reallocating right now, I believe they\u2019ll come back in H2. Any non-structural market correction should be viewed as a buying opportunity \u2014 especially in quality sectors and stocks with leadership and earnings visibility.<\/p>\n

Another important economic event this week was the RBI<\/a>\u2019s credit policy. While rates were left unchanged, the Governor reiterated support for growth.<\/p>\n

Given the current inflation outlook, do you think RBI has room to cut rates? The next policy is due in October. Could there be a festive surprise in the form of a rate cut?
<\/strong>Mayuresh Joshi: <\/strong>That\u2019s certainly a possibility. A 25-bps rate cut is still expected, possibly in the next policy or the one after.<\/p>\n

The outlook depends on how global events unfold. Will the Fed move in September? What inflationary impact will Trump\u2019s policies have \u2014 not just in the US, but globally? How will he negotiate with India, China, and other BRICS nations?<\/p>\n

So yes, a 25-bps cut in the October policy ahead of the festive season is very much on the table. Let\u2019s see how the RBI navigates this.<\/p>\n

Given how tricky markets are, investors are unsure about when to enter. They anticipate downtrends, but don\u2019t know where the bottom lies. If someone wants to invest now, what should their strategy be? Imagine I give you a blank canvas \u2014 how would you paint it?
<\/strong>Mayuresh Joshi: <\/strong>Honestly, no one can predict the bottom. As our late founder often said, \u201cI\u2019ve never seen a successful pessimist.\u201d<\/p>\n

So I remain very optimistic about India over the next 5\u201310 years. It\u2019s still a fundamentally domestic-driven growth story.
Regardless of Trump\u2019s policies, certain hospital stocks in healthcare can continue to do well. So can select pharma names \u2014 because manufacturing medicines cost-effectively inside the US isn\u2019t feasible.<\/p>\n

Apparel and consumption names also look attractive, especially domestic-focused value apparel brands, which could benefit from the rural and urban consumption recovery. FMCG is poised for a strong comeback. Agrochemical stocks too, due to strong monsoons and volume growth, may see improved operating leverage. Financials will also play a key role \u2014 as private capex returns, financials will support the broader ecosystem.<\/p>\n

So yes, focus on domestic stories \u2014 consumption, financials, select autos, and agrochemicals. These areas are insulated from global noise like Trump tariffs and have solid earnings visibility. Don\u2019t get shaken by corrections. Instead, treat them as opportunities to enter stocks you may have missed earlier.<\/p>\n

Is there any particular sector you\u2019re focused on right now \u2014 and any you\u2019re avoiding?
<\/strong>Mayuresh Joshi:<\/strong> Within healthcare, I\u2019m positive on the hospital segment. The numbers have been stable and are expected to remain strong. These companies have adopted smart expansion strategies \u2014 both brownfield and greenfield \u2014 which keeps balance sheet leverage low. Average revenue per operating bed is improving, which boosts earnings potential.<\/p>\n

On the other hand, I remain cautious on IT. The sector still faces several headwinds. What seemed like a bright beacon a few decades ago now requires reinvention. Globally \u2014 including from Chinese companies \u2014 there\u2019s rising competition via AI-based platforms. AI is becoming the buzzword \u2014 be it generative AI, agentic AI, or agile AI.<\/p>\n

Indian IT companies need significant investment to stay relevant. The labor cost advantage they once enjoyed is diminishing as AI-driven models outperform legacy models. Until IT companies remodel and re-strategize, I\u2019d remain circumspect. So for now, I\u2019m avoiding the sector.<\/p>\n","protected":false},"excerpt":{"rendered":"“In times like these, rather than getting shaken out, if you continue your systematic investments, they will yield…\n","protected":false},"author":2,"featured_media":329881,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3091],"tags":[51,108806,2441,69064,3354,554,16,15],"class_list":{"0":"post-329880","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-business","9":"tag-fpi","10":"tag-markets","11":"tag-mayuresh-joshi","12":"tag-rbi","13":"tag-trump-tariffs","14":"tag-uk","15":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114997427215156792","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/329880","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=329880"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/329880\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/329881"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=329880"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=329880"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=329880"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}