Investors should selectively increase exposure to sectors where earnings visibility is improving and revisions have bottomed out, rather than relying on broad market beta. Hussain Selani, head of investments for India and Global Indians, Barclays Private Bank, tells Christina Titus that this phase of the cycle belongs to earnings, not multiples. Sectors such as financials, industrials, automobile, telecom, and real estate and building materials stand out as the clearest beneficiaries. Edited excerpts:
What should be the equity investing strategy this year?
Investors should look at 2026 through a constructive, earnings-led equity strategy rather than relying on multiple expansion. Medium-term growth remains resilient, with GDP tracking around 6.5%, creating room for earnings upgrades as spare capacity is absorbed without reigniting inflation. After a year of downgrades, the earnings cycle is turning, with 12-month forward EPS (earnings per share) expected to grow by about 14% through CY26. Within this, India continues to stand out as a relative growth compounder, supported by resilient domestic demand and strong local investor participation, keeping equities well-positioned for steady, earnings-driven returns.
What are the sectors investors should capitalise on?
Investors should selectively increase exposure to sectors where earnings visibility is improving and revisions have bottomed out, rather than relying on broad market beta. This phase of the cycle belongs to earnings, not multiples. Sectors like financials, industrials, automobile, telecom, and real estate and building materials stand out as the clearest beneficiaries. Banks remain at the heart of the profit cycle, supported by accelerating credit growth and healthy balance sheets. Industrials benefit from strong order books and cleaner cash flows, while automobile gain from lower rates and GST changes. Telecom enjoys stable pricing power, and real estate continues to benefit from structural demand and improving funding conditions.
Why should gold and silver feature in the investment portfolio?
Gold delivered a standout year in 2025, rising over 60% and reaching multiple all-time highs, supported by geopolitical tensions, a softer dollar, and central-bank accumulation. Silver, which gained nearly 160%, offers higher sensitivity to global capex cycles and monetary volatility. As global growth moderates and liquidity normalises, precious metals provide a cushion against drawdowns, currency weakness, and market shocks.
What is your outlook on debt in 2026?
The outlook for fixed income in 2026 is constructive, favouring carry-focused, high-quality portfolios over aggressive duration strategies. Investors should lean toward high-quality, medium-duration portfolios that benefit from spread compression without taking excessive rate risk. With corporate balance sheets in solid position, select AAA and AA opportunities remain attractive. Duration should be added tactically during yield spikes, with the next rate-hike cycle expected only in the third quarter of FY27.