Marcellus Favors Large Caps Amidst Stretched Midcaps

Krishnan VR of Marcellus Investment Managers says mid- and small-cap valuations remain elevated after a 16-month period of muted returns, and he favors large-cap stocks for better risk-reward while anticipating an earnings recovery in FY27 amid a stable domestic economy. He highlights strong Q3 earnings in PSU banks, metals, and oil & gas, and recommends focusing on high-quality companies with clean accounts and strong balance sheets.