Markets near fresh highs as FIIs eye India again; betting on high-beta sectors: Siddharth Vora

The Indian stock market could be entering a new growth phase as multiple global and domestic triggers align in its favor, according to Siddharth Vora, Head of Investment Strategy and Fund Manager at PL Asset Management. Speaking to ET Now, Vora said his team has turned “extremely bullish” on both the short- and medium-term outlook after nearly a year of cautious positioning.

Positive signals for India

Over the past two weeks, investor sentiment has improved sharply, supported by easing global trade tensions and stable domestic fundamentals. Vora noted that the shift in tone from former US President Donald Trump on tariffs—from hostile to accommodative—has removed a key overhang for foreign flows into India.


“Most other things are already in good shape for India,” he said, pointing to stable inflation, a favorable interest rate cycle, steady tax reforms, and robust domestic consumption. “We are set up well for markets to come out of the consolidation zone and stay positive.”

New highs could come sooner than expected

On the question of when the markets might touch new highs, Vora said the timing is hard to predict but the momentum is strong. “Sometimes what we expect to play out over 6–12 months happens in just 2–3 months. With the triggers improving, we are in good shape for a strong recovery from here.”

Sector strategy: Favouring high beta plays

PL Asset Management has shifted its portfolio toward higher beta sectors—those that tend to perform better during market rebounds. Vora said they remain overweight in materials, including metals, mining, cement, and chemicals, followed by financials, autos, consumer discretionary, industrials, and healthcare.

“Within financials, we prefer asset managers, NBFCs, insurance, and capital market plays, while staying away from banks for now,” he explained.

Conversely, low-beta sectors such as IT and pharma services remain underweight. Vora believes India’s IT sector is not yet fully prepared for the artificial intelligence (AI) wave, unlike the U.S., where technology giants are benefiting from rapid adoption of AI-driven products.

“In India, IT is still service-oriented. The skillsets and capabilities required for AI are different, and the industry will need a complete revamp to stay relevant in the next 4–5 years,” he warned.

FIIs could return in H2

One of the big questions for Indian markets is the return of foreign institutional investors (FIIs), who have been net sellers in recent months. Vora outlined the three factors FIIs track—growth, valuations, and risk.

“In the last year, India was at a disadvantage on all three. Growth seemed uncertain, valuations were expensive versus peers, and risks were elevated due to geopolitical factors,” he said.

That picture is now changing. Valuations are back to neutral levels, growth triggers are in place, and geopolitical risks are easing. “FIIs cannot avoid India for too long,” Vora said confidently.

Rate cuts could boost emerging markets

Global central bank decisions are also in focus, with the U.S. Federal Reserve expected to cut rates. Vora said that historically, rate cuts tend to benefit emerging markets, and India too could be a beneficiary this time, unlike in the last two cycles.

“The dollar index is weak, the U.S. outlook has softened, and rate cuts are being priced in. This is positive for equities globally and especially for emerging markets. Gold, in particular, will be a big beneficiary,” he added.

Summing up, Vora said India’s markets are at the cusp of a new uptrend backed by stronger domestic consumption, stable macro fundamentals, and improving foreign investor sentiment. With high-beta sectors likely to lead the rally and foreign flows expected to return, he sees the potential for markets to break past consolidation and move toward fresh highs sooner rather than later.