India's FY27 Growth Story Remains Intact Amid Middle East Tensions: Qode Analyst

Qode Advisors Maintains Medium-Term Earnings and Growth Assumptions

Gaurav Didwania, Partner and Fund Manager at Qode Advisors, has expressed that the company's medium-term earnings and growth assumptions for FY27 remain intact. Despite the recent market correction, Qode Advisors believes that India's structural growth drivers remain strong, and unless the external shock becomes deeper and more prolonged, the broader FY27 framework will not undergo significant changes.

Select Opportunities Amid Correction

The market correction has created selective opportunities for investors. However, Gaurav Didwania emphasizes that this is not the time for indiscriminate buying, and stock selection and balance-sheet quality are crucial factors to consider. Qode Advisors has started looking more constructively at parts of the market where valuations have become more reasonable and earnings visibility remains intact.

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Focus on Domestic Cyclicals and Structural Growth

Qode Advisors is more constructive on domestic cyclicals and areas linked to India's structural growth story. The fund manager highlights select financials, industrials, capital goods, power, and power-adjacent themes, as well as quality consumption names, as interesting on correction. Opportunities in segments benefiting from manufacturing, infrastructure, and energy transition trends also remain.

Cautious Approach to Near-Term Earnings

Gaurav Didwania is cautious about March and June quarter earnings, particularly in light of oil supply disruptions. The fund manager notes that crude volatility or elevation can affect input costs, inflation expectations, and margins across sectors. However, this caution does not alter Qode Advisors' medium-term earnings and growth assumptions.

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Quant-Driven Approach for Consistent Returns

Qode Advisors' quant-driven approach enables consistent risk-adjusted returns across different market cycles. The fund manager attributes this to the removal of emotional bias and reliance on data, signals, and disciplined execution. This framework allows Qode Advisors to dynamically adapt to changing market conditions, participate in upside trends, and manage drawdowns more effectively.

Key Assumptions and Recommendations

• Maintain medium-term earnings and growth assumptions for FY27
• Focus on domestic cyclicals and areas linked to India's structural growth story
• Select financials, industrials, capital goods, power, and power-adjacent themes, as well as quality consumption names, as interesting on correction
• Opportunities in segments benefiting from manufacturing, infrastructure, and energy transition trends remain
• Approach near-term earnings with caution due to oil supply disruptions