“I think auto will be the star of the year…I think you should buy auto ETF,” he said, speaking at CNBC-TV18 Market Forum.
His view comes at a time when investors remain cautious, mid- and small-caps are under pressure, and leadership is expected to shift decisively towards sectors with operating leverage and improving demand visibility.
Agrawal’s optimism is anchored in a clear turnaround in earnings momentum.
According to Motilal Oswal’s coverage universe of over 350 companies, aggregate earnings growth is expected to touch around 20%. With government policy turning supportive through monetary easing, tax relief and GST rationalisation, he sees a strong backdrop for cyclical sectors to shine.
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Within that framework, autos stand out. The sector is poised to benefit from improving consumer sentiment, easier financing conditions and a pickup in overall economic activity.
Beyond autos, he also maintained a positive view on PSU-led themes, particularly PSU banks, citing attractive valuations and earnings growth that continues to outpace private sector peers. Large caps, in general, were highlighted as better positioned than mid and small caps in the current market phase.
“I think large large caps are better chance to beat the market than the mid and small second. I think PSU still have lot of steam. They are much more reasonably valued than private sector, and earnings growth is almost 2x of private sector. So that looks to be a very interesting category,” he said.
Agrawal also appeared largely unconcerned by the global macro noise from geopolitics to trade disruptions, particularly US President Donald Trump, even though he believes that “the world is very interdependent”.
“Trump doesn’t impact me,” he said and went on to borrow words of Singapore Prime Minister who said “Whatever Trump does, trade will find its own way.”
“One side Trump is happening, other side AI is happening. So I don’t know how to figure out which is going to bet how much. So I would remain. I would feel very happy that I’m in India. I do things which I understand and we will will find few things in investing,” he added.
He further advised that long-term investing does not require one to have an opinion on everything.
