He said the Information Technology (IT) sector could see improved performance in 2026. Lokapriya noted that US hyperscalers are spending close to $100 billion every quarter on artificial intelligence infrastructure.
He said the rollout of AI applications will require support from IT services firms, creating opportunities for Indian companies. “This is similar to what happened during the cloud rollout,” he said, where earnings picked up after an initial slowdown.Also Read |
Quest Investment CIO stays cautious on IT, turns positive on banks and consumption
On consumption, Lokapriya drew a distinction between durables and staples. He said government measures and Goods and Services Tax (GST) cuts have increased spending power, benefiting durables such as vehicles, appliances and wellness products. In contrast, he said pricing power remains limited for traditional fast-moving consumer goods companies. “I would focus more on the durable bit, as well as specific plays like wellness,” he said.
In metals, Lokapriya differentiated between precious and industrial segments. He said silver has a structural driver as demand is higher than supply, while gold has already seen a strong move. For industrial metals, he expects support from a global economic recovery, interest rate cuts across major economies and higher manufacturing-led capital expenditure.
Lokapriya identified financial services as the main driver of index earnings over the next few years. He said the sector could contribute nearly half of the incremental earnings between fiscal year 2025-26 (FY26) and fiscal year 2027-28 (FY28). “They will represent nearly 50% of the incremental earnings of the overall index,” he said, adding that growth is likely to be led by public sector banks, non-banking financial companies and large private banks.
For the full interview, watch the accompanying video
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