AI fear over IT overdone, but near-term pain likely to persist: Seshadri Sen

Seshadri Sen remains tactically underweight on IT, arguing that AI-related fears are overdone but no clear triggers exist for a sector re-rating over the next three to six months, with short-term pain likely to persist. He prefers discretionary consumption, industrials, and select small and midcap financials, citing attractive valuations and supportive FDI flows in the latter. On the macro side, Sen expects Nifty earnings to stay stable with the share of companies delivering 25 percent plus growth rising from 31 percent in FY26 to 41 percent in FY27, FII selling to ease though flows are unlikely to rush back, the RBI to remain on an extended pause, and inflation to stay contained despite pockets of rural demand weakness.