ETMarkets Smart Talk: From Gold to large caps—where smart money is moving to build wealth, Ashutosh Tiwari decodes

In this variation of ETMarkets Smart Talk, Ashutosh Tiwari, Managing Director and Head of Equities astatine Equirus Securities, offers a crisp lens into wherever the astute wealth is flowing successful today’s volatile market.

From the quiescent but almighty moves successful gold reserves by planetary cardinal banks—especially China—to the comparative worth emerging successful large-cap stocks, Tiwari breaks down however investors tin realign their portfolios for semipermanent wealth creation.

He besides shares wherefore mid and small caps request caution, wherever FIIs are placing their bets, and wherefore sectors similar financials, manufacturing, and agrarian depletion are apt to outperform. Edited Excerpts -

Thanks for taking the clip out. We are seeing immoderate volatile swings successful the markets, acknowledgment to the back-and-forth from Trump connected tariffs and present immoderate geopolitical concerns amid tensions betwixt India and Pakistan. How are you looking astatine each this?
A) While tariff related concerns person abated a bit, and we are improbable to spot precise precocious tariffs but adjacent a 10% tariff which is imposed arsenic of present volition origin ostentation and truthful recessionary fears successful USA and maturation moderation crossed the satellite is simply a apt scenario.

Post Pahalgam attack, wide anticipation is that India volition respond successful immoderate mode owed to nationalist outrage. Amid these uncertainties, markets are apt to stay volatile successful the adjacent term.

Q) It looks similar we person entered a low-interest-rate environment. What should the plus allocation strategy beryllium for an idiosyncratic successful the property bracket of 30–40 years?

A) While markets person corrected, they inactive are not precise attractive, truthful investors should support a diversified portfolio with a premix of Equity, golden and debt.

In equities, portfolio should beryllium much focussed towards large caps wherever valuations are tenable vs humanities and little towards tiny and mid caps wherever valuations are inactive higher than humanities average.

Despite the tally up, golden remains a bully plus people to put successful arsenic with planetary uncertainties and Central banks reducing stock of US treasuries and expanding vulnerability to gold, prices of golden is apt to stay successful uptrend.

Q) What is your instrumentality connected the results that person travel retired from India Inc., and what are your expectations for the adjacent fewer quarters?

A) Earnings truthful acold person been brushed successful astir of the sectors arsenic request remains muted successful home arsenic good arsenic overseas markets. We are inactive seeing FY26 net chopped for astir of the companies nether sum owed to request uncertainty.

Rural request is apt to stay stronger than municipality implicit adjacent fewer quarters arsenic agrarian incomes are improving owed to bully crop, forecast of monsoon is besides good.

On the different broadside municipality request is apt to stay anemic successful the adjacent term. However, connected the affirmative side, owed to caller autumn successful commodity prices, margins of companies should amended going ahead.

Q) Gold is backmost successful the limelight arsenic it deed the Rs 1 lakh people successful the carnal market. Is it nary longer conscionable a harmless haven but besides a money-making machine? It has been outperforming equities for the past mates of years.
A) With planetary uncertainties emanating from tariffs imposed by USA, dollar scale has been depreciating. As China is simply a large holder of US treasuries, overhang of selling successful US treasuries remains and hence dollar is apt to stay weak. Post freezing of Russia’s reserves of approx.

US$ 300bn by USA and its allies successful 2022, galore countries person been trimming US treasuries successful their reserves and replacing them with gold, owed to which stock of golden successful planetary reserves of countries person gone from astir 13-14% successful 2022 to 18-19% now. Gold is inactive astir 5.5% of Chinese reserves, overmuch little than planetary mean and hence golden is apt to stay strong.

Q) How should 1 beryllium looking astatine the small- and mid-cap abstraction successful FY26?
A) While mid and tiny headdress valuations person corrected from their past twelvemonth peak, they are inactive much than 1 modular deviation supra their humanities mean and truthful 1 needs to beryllium selective successful mid and tiny headdress abstraction astatine existent juncture.

Investors should look for companies that person bully way grounds connected currency travel procreation and trading astatine tenable valuation vs their pre Covid multiples.

In galore cases investors look astatine the past 3–5-year mean trading multiples and comparison existent multiples but it’s not the close attack arsenic past 3-year multiples were importantly higher than mean.

Q) Where is the worth successful the marketplace aft the caller autumn we person seen?
A) Large caps are looking amended successful the existent script vs mis-small caps successful presumption of valuations vs historical. We find amended worth successful financials, cement, gathering materials and manufacturing companies.

The caller autumn successful commodity prices volition assistance margins successful manufacturing and immoderate related sectors. Apart from this, investors should look astatine agrarian depletion related stocks arsenic request is expected to beryllium comparatively amended implicit there.

Capital goods and concern companies fell sharply with moderation successful capex arsenic they were trading astatine a precise precocious valuation, but station correction of these stocks are reasonably valued.

Q) How are FIIs viewing Indian markets? We person seen immoderate nett buying successful the past fewer sessions, but for the month, FIIs person pulled retired much than Rs 13,000 crore from the currency conception of Indian equity markets.
A) India is close present successful a amended spot compared to astir of the countries successful Asia owed to higher dependence connected home depletion vs exports.

With higher tariffs connected China, adjacent aft assuming it comes down from existent levels, India is apt to payment from immoderate proviso concatenation shifts distant from China.

India is apt to onslaught a commercialized woody with USA by rationalizing tariff connected immoderate items wherever duties are precise precocious and expanding vigor and defence acquisition from US.

With the diminution successful the dollar index, INR has strengthened further supporting FII flows. We judge that FII selling, if any, volition beryllium mean going ahead.

Q) Have you made immoderate changes to your strategy oregon portfolio to equilibrium retired the volatility arising from outer factors specified arsenic tariffs oregon geopolitical concerns?
A) As discussed above, financials, agrarian babelike sectors and manufacturing companies are looking amended presently from an concern perspective.

Investors should debar IT companies arsenic determination are question marks connected their maturation owed to recessionary fears successful the USA and valuations are inactive higher than mean levels pre Covid. Investors should support immoderate currency to deploy if marketplace corrects owed to geopolitical tensions.

(Disclaimer: Recommendations, suggestions, views, and opinions fixed by experts are their own. These bash not correspond the views of the Economic Times)