Harish Krishnan, Co-Chief Investment Officer and Head of Equity at Aditya Birla Sun Life AMC, believes the next phase of the market upcycle will be led by select underperforming sectors rather than a broad-based move. The fund house manages $3.34 billion as of October 31, 2025.
One major call from the AMC is a bullish stance on Indian IT services after a prolonged period of underperformance.
“The real recipe for making money in markets is to buy at low expectations,” Krishnan said.
He cited three reasons for confidence – One, IT’s market cap share has fallen below its profit share for only the third time in 30 years. Two, rupee depreciation is supporting margins. And three, expectations are “way too low,” strengthening the medium-term risk-reward.
Also Read | An $11 billion fund CIO sees Nifty hitting new highs by December, favours neglected sectors
Krishnan sees scope in commodities as countries push for resource independence amid geopolitical uncertainty. He also remains positive on platform-based businesses like exchanges due to operating leverage benefits.
“The key aspect for us is how much of it is already priced in and where we are in the cycle?” he said.
He added that the firm prefers early-stage new-age companies with strong unit economics and limited competition — “day zero or maybe in day one” opportunities.
Krishnan said benchmark indices may be near highs, but market breadth is weak. He attributed this disconnect to a large supply of new shares from IPOs and promoter or private equity stake sales.
“Current supply of paper is close to about 2% of market cap on an annualised basis… this amount of paper we have never seen,” he said.
He noted that earnings growth remains healthy and should improve in the December and March quarters, suggesting fundamentals are intact.
Also Read | Stronger earnings ahead, but near-term gains could stay limited, says Axis AMC
Krishnan said investors should shift focus from large-, mid- and small-cap buckets to specific sectors poised for a recovery.
“These eight or nine sectors account for about 50% of the profit pool of India… but account for only about 40% of the total ownership,” he said.
Aditya Birla Sun Life AMC is increasing exposure in:
- Chemicals
- Insurance
- Cement
- Metals
- IT services
- Private banks
He pointed out improving market share trends in insurance and valuations that now offer reasonable upside potential.
For the full interview, watch the accompanying video
Catch all the latest updates from the stock market here