The report from Omniscience Capital noted sustained flows into small-, mid- and multi-cap schemes and continued selling pressure in large-cap funds, adding that concentration of equity inflows into mid and small caps is concerning given their premium valuations.
“Opportunities for long-term investing are emerging in mispriced pockets of the top 100 companies, which could potentially deliver better performance over the next three to five years,” said Ashwini Shami, President and Chief Portfolio Manager, Omniscience Capital.
Ahead of the festive season, banks, infrastructure NBFCs, HFCs, power, select energy-transition stocks, business services, EPC and select infrastructure names offer strong growth outlooks at more attractive valuations, the report said.
Large-cap stocks remain broadly investable, aside from overvalued areas facing structural AI or macroeconomic headwinds.
Small-cap index is fully priced, but rigorous bottom-up selection still yields excellent stock-specific opportunities from a universe of nearly 1,000 companies.