Experts at Ambit Institutional Equities advise shifting toward FMCG, pharma, IT and telecom shares due to their past resilience as India confronts structural hurdles to expansion. Bank, cement and IT equities may serve as short-term options. The view gained weight after economists highlighted risks from concentrated retail holdings in small and mid-cap stocks. Bharat Arora of Ambit noted that elevated valuations in these segments point to downside potential. Analysts said India’s underlying growth issues persist despite easing global tensions. Dhananjay Sinha of Systematix Group warned of a possible low-equilibrium path marked by overstated official figures, weak demand, slower productivity and limited employment. Foreign investors withdrew over 2.8 lakh crore rupees in 2026 as corporate earnings failed to match valuations and dollar returns stayed low. Swayamsiddha Panda of Ambit pointed to uneven household spending and limited fiscal room. A Systematix note urged action on income weakness and investment revival. Bernstein researchers wrote to the prime minister that policy alignment has shown results but further difficult choices are needed before the window closes.
