He advised investors to be overweight in the CV space, stating that it is insulated from electrification risks and overseas competition relative to passenger vehicles, and added that lower interest costs could drive a replacement cycle. “Very positive on the CV industry and I think one can be overweight on both companies, Tata Motors’ CV as well as Ashok, but just Ashok is a better preference because of a good track record,” Mehta concluded.
Beyond cyclicals, Mehta sees pockets of opportunity and caution across consumer-facing and technology-led sectors. Mehta offered a more nuanced view on new-age technology stocks, highlighting sharply diverging prospects. He expressed disappointment with Ola Electric, pointing out that the company has failed to capture the expected market share as legacy players, such as TVS Motor Company and Bajaj Auto, gain ground in the electric two-wheeler market.
Also Read: Auto ancillaries, power and midcap IT in focus; strategist cautious on financials, new-age IPOs
He also stated that goods and services tax (GST) reductions have narrowed the price gap between electric and internal combustion engine vehicles, reducing the incentive for consumers and weighing on demand. Mehta advised against bottom fishing the stock at current levels, but suggested existing investors remain invested for the long term and await exit opportunities, as the opportunity to sell has already passed.
In contrast, Mehta remains bullish on Meesho over the long term, distinguishing its marketplace model from quick-commerce companies and comparing it more closely with Amazon and Flipkart. Despite the sharp rally since listing, with the stock nearing UBS’s target of ₹220, he advised investors to stay invested. While acknowledging the risk of a near-term correction due to listing-related exuberance, Mehta described Meesho as a “great long-term story.”Also Read: Aditya Birla AMC’s Mahesh Patil lays out long-term strategy for new-age tech, quick commerce
His tone was more cautious on large-cap IT services companies, particularly Tata Consultancy Services. Mehta said his firm has stopped tracking TCS closely due to a lack of meaningful growth and expressed disappointment that artificial intelligence (AI) has not translated into a stronger revenue or profit impact for IT services firms. While TCS has begun disclosing AI-related revenue of $1.5 billion, Mehta believes growth rates across the sector have moderated. In his assessment, IT stocks may see trading rallies but are unlikely to deliver strong long-term growth from current levels, offering at best market-equivalent returns.
Mehta was more constructive on asset management companies (AMCs) following recent regulatory changes by the Securities and Exchange Board of India (SEBI). He described the impact of the total expense ratio changes as “mildly negative” and far less severe than initially feared by the market. According to him, the ability of AMCs to raise fresh assets under management and the steady inflow of systematic investment plans will help neutralise the impact over the next few quarters. Mehta remains very positive on the industry, calling it a “nice annuity-based business,” and does not expect the regulatory changes to materially affect its long-term growth trajectory.
For the entire interview, watch the accompanying video
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