The market slid into a corrective tailwind last October—margin‑trading pressures, crude oil climbing to $114, and looming rate hikes pushed mid and small caps lower, creating a buying window for firms with solid earnings.
Devang Mehta, Deputy MD & CIO‑Equity at Spark Capital Private Wealth, highlighted that mid and small caps outpaced large‑caps, delivering a 20‑21% revenue uptick in a survey of roughly 450 companies. He noted that heavyweights in banking, IT, oil & gas, and FMCG have seen polarized earnings, whereas the mid‑cap space remains resilient.
Within capex, Mehta zeroed in on engineering, manufacturing, defence, aerospace, and auto ancillaries—especially power ancillaries and precision engineering. The power automation and high‑voltage DC segment alone offers a ₹12 lakh crore runway, yet order books sit at just ₹60‑65 k crore, hinting at a 10‑20% correction to capitalize on long‑term growth.
The capital‑market theme, driven by under‑penetration, is slated to compound steadily through asset management, exchanges, intermediaries, and wealth managers. Mehta forecasts this area to mirror the broader 18‑25% growth trajectory, positioning it as a key play for investors eyeing multi‑year returns.
Looking ahead, Spark Capital’s guidance stresses a market‑cap‑agnostic stance, favoring broad‑market exposure while targeting the capex‑heavy sectors identified. The firm expects to monitor the October pullback’s depth and the evolving macro backdrop before making targeted allocations.