Buy selectively, focus on resilient sectors despite volatility: Manish Sonthalia

Indian markets are navigating a difficult environment as geopolitical tensions and global inflationary pressures create uncertainty for investors. From Manish Sonthalia MK Investment Managers shared their views on the current landscape and potential opportunities.

On the market environment, Sonthalia said, “The conflict will first widen, then shift to a long phase of economic adjustment and selective repair rather than a comprehensive recovery. This is no longer just a geopolitical event—it is affecting oil prices, LNG and the supply chain, creating inflationary shocks. India, dependent on oil, will feel the impact till then, in FY28 and again in 2017.”

On buying opportunities, he added, “For foreign investors, returns are less attractive in dollar terms due to rupee depreciation. But for domestic investors, valuations have moved closer to Covid-era levels. Some sectors and companies now look attractive over a three-four year perspective. Domestic savings replace foreign inflows and hence one should focus on stocks.”

When asked about sector preferences, Sonthalia noted, “Sectors benefiting from inflation, commodities, consumption with pricing power, defense, renewables and hospitals look promising. Financials require selection – private banks are solid long-term, while PSU banks offer favorable valuations. Overall, sector selection should be done with caution and focus.”

The market may be turbulent in the short term, but selective opportunities exist for disciplined investors with a long-term horizon.