No returns in 2 years? Axis AMC’s Shreyash Devalkar reveals where he's investing now

Axis AMC fund manager Shreyash Devalkar notes the equity market has underperformed over the past two years, with FII outflows of around Rs 2.85 lakh crore in 2026 driven by the global AI trade and macro headwinds including war-related pressures on the rupee and crude. Despite these concerns, underlying Q4 earnings growth held at 14 to 15 percent with healthy cash flows and no visible NPA stress, which he says masks a decent economic picture. He is constructive on mid and small caps in power, renewables, data centres, EVs, hospitals, and capital-markets-linked businesses, while cautioning that valuations in these segments have run up significantly, with his multicap fund keeping mid-small cap exposure at about 25 percent versus the 30 to 35 percent permitted.