Axis Equity Head Shreyash Devalkar Urges Bottom-Up Stock Picking

By siliconindia  |  Tuesday, May 13, 2025

Axis Equity Head Shreyash Devalkar Urges Bottom-Up Stock Picking

In-short

  • Axis Mutual Fund's Head of Equity, Shreyash Devalkar, emphasizes bottom-up stock picking amid uneven earnings despite strong macroeconomic indicators.
  • Limited upside in sectors like banking and prefers company-specific opportunities in pharmaceuticals, IT and niche lenders. 
  • Axis Equity Head Shreyash Devalkar advises focusing on long-term fundamentals over short-term trends, especially in sectors like travel and tourism.

In spite of favorable macroeconomic conditions, earnings visibility across Indian sectors remains inconsistent. The Head of Equity at Axis Mutual Fund Shreyash Devalkar to uphold a bottom-up stock picking strategy over broad-based sector calls. Axis Mutual Fund currently looks after nearly $38 billion in assets under management.

“Macro, especially the currency, forex reserves, fiscal deficit, and liquidity support from the Reserve Bank of India, is helping a lot,” Devalkar said. These factors have contributed to a stable domestic environment, even as global uncertainties persist. Meanwhile, he cautioned that the strength in macro indicators weren’t reflected yet consistently across corporate earnings.

During the latest earnings season, Devalkar pointed out sluggish volume expansion in key sectors such as automobiles and consumer staples. “The positive is that there is no further deterioration, but otherwise growth numbers are not very encouraging,” he marked, specifying the subdued nature of demand in several segments.

Globally, sentiment has improved on the back of reduced geopolitical tensions and the partial rollback of US–China tariffs, which bodes well for trade. Therefore, Devalkar believes much of the potential upside from these developments is already priced into markets. “The overhang on global growth is behind, or is going to be behind — if not today, then in three to six months,”  he added.

On the domestic front, Devalkar sees limited room for further re-rating in the banking sector. After a strong rally and sectoral revaluation, he believes valuations now may occur wholly, especially when weighed against the backdrop of moderating economic expansion. Rather than adopting a top-down sector view, Devalkar recommends a more selective, bottom-up investment approach. He sees attractive opportunities in pharmaceuticals, IT services, and among niche lenders, though he refrains from making sector-wide calls. 

In sectors like travel and tourism, he explicitly states that structural trends and competitive positioning matter more than temporary developments. “If the market structure is in your favour, that is the key criteria for long-term investment,” he added, underscoring the importance of long-term fundamentals over short-term.

As India continues to navigate a complex global and domestic economic landscape, Devalkar’s guidance reflects a balanced, research-driven approach. His strategy prioritizes long-term resilience and fundamental strength over short-term momentum, making it particularly relevant for investors seeking to build a robust portfolio in uncertain times.

 

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