Why a Rs 72,000 crore fund manager refuses to chase power and defence rally now

A fund manager from ICICI Prudential Equity & Debt Fund, managing Rs 72,000 crore, warns that valuations in power and defence sectors have already priced in future growth, leaving limited margin of safety. The fund currently holds 73-75% equity and favours banking, select discretionary consumption (autos, consumer), pharma, and export-oriented stocks, while maintaining limited exposure to PSU banks and expressing caution on expensive defence valuations across both PSU and private names.