He remains confident in the broader bull market, but believes it is now a “very mature bull market.”
Speaking on the market’s recent slide, Murarka said, “The correction that we’ve seen over the last five months is more a correction in a bull market… As far as the Nifty index is concerned, probably markets will consolidate at these levels for the next few months before we make the next move up.”
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He highlighted that current valuations are at a 10% discount to their 15-year average, which offers some comfort. “Given that we are in the midst of a cyclical slowdown… the returns this year could be as well into single digits at the Nifty 50 index level,” he added.
Despite the cautious outlook, Murarka sees emerging opportunities in specific sectors.
He is particularly optimistic about consumption stocks, believing that the worst of the slowdown is over. He noted early signs of recovery in rural demand and pointed to government policy shifts, such as tax relief measures and potential GST rate cuts, as positive catalysts.
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Murarka also sees potential in private sector financials, particularly large banks that have lagged in recent years. “We like financials, and within that, private sector financials… like HDFC Bank and Kotak Bank, are really now our favourite ones,” he stated. He believes these banks have worked through past challenges and are well-positioned for a growth rebound.
Murarka expects the broader economy to gain momentum in the second half of 2025.
However, he warns that stock selection will be key, as the recovery is likely to be uneven across sectors
