Buy capital goods on dips, stay cautious on IT and consumption: Sudip Bandyopadhyay

From a resilient SBI to a pharma sector he believes is on the verge of a generational re-rating, market expert Sudip Bandyopadhyay laid out a sector-by-sector roadmap for investors navigating a market rich with opportunity, but not without risk.

The post-results selloff in State Bank of India, Bandyopadhyay argued, was a profit-booking move rather than a fundamental verdict. Talking to ET Now, he pointed to credit growth of 16%, ahead of the industry, a domestic net interest margin of 3%, declining cost of credit, and well-controlled NPAs as evidence that the bank's underlying health remains intact. With the stock trading at just 10–11 times earnings, he sees the dip as an opportunity rather than a warning sign. The only blemish: slippages edged up from roughly ₹4,400 crore to ₹5,500 crore quarter-on-quarter.

Pharma

Bandyopadhyay was emphatic that Indian pharma is at the start of a multi-decade run, drawing a parallel to where the sector stood 20 years ago. He singled out Sun Pharma's acquisition of Organon as a genuine game-changer — the deal will lift Sun's branded product mix to roughly 70% of its portfolio, fundamentally distinguishing it from generic-heavy peers. Beyond Sun, he named Aurobindo Pharma as attractive on valuation grounds, noting that regulatory headwinds have been steadily clearing. Mankind Pharma remains a long-standing high-conviction pick for domestic consumption exposure.

Indian pharma is at the cusp of a take-off. There will be a lot more excitement, lot more action — probably where it was 20 years back.

-Sudip Bandyopadhyay, Market Expert

Consumption

Despite solid Q4 showings from HUL and Nestle — both of which maintained their full-year guidance — Bandyopadhyay urged caution on the consumption theme for the next two quarters. His primary concern is the El Niño-linked monsoon risk, which he views as a more persistent threat than the West Asia conflict. If forced to stay invested in the space, he would concentrate in large-cap FMCG names like HUL and Nestle, which carry the brand depth and distribution muscle to weather a rural demand slowdown. Consumer discretionary names, he suggested, warrant a lighter touch for now.

Capital goods

This is where Bandyopadhyay's conviction is at its highest. He views any price weakness in quality capital goods names — triggered by external events like the West Asia conflict — as a long-term buying window. L&T, BHEL, Thermax, and GE Vernova all feature on his watchlist, with L&T's emerging defence vertical adding another dimension to an already compelling growth story. "Start picking up stocks you do not already have," was his direct advice to investors building a long-term portfolio in this space.

IT

Indian IT remains in a wait-and-watch zone for Bandyopadhyay. While he acknowledged that select names — notably HCL Technologies for its aggressive AI pivot and Coforge for its acquisition-led capability build — are pulling ahead of peers, he cautioned that valuations across the sector are not yet cheap enough to warrant broad exposure. Until the industry's AI-driven disruption finds a clearer equilibrium, he favours selective positioning over sector-wide bets.