According to reports from CNBC TV18, Axis Mutual Fund has strategically shifted its portfolios towards consumption-oriented sectors and large-cap financials after increasing exposure over the past six months. The fund, which managed $39.61 billion in assets during the April-June 2026 quarter, is positioning itself to capitalize on improving prospects for consumption-linked businesses after a prolonged period of underperformance. As reported by CNBC TV18, Shreyash Devalkar, Head of Equity at Axis Mutual Fund, noted that these sectors had lagged for the last two to three years, creating opportunities as growth conditions improve.
As reported by CNBC TV18, Devalkar emphasized that large-cap funds are currently better placed because they have higher exposure to banks, fast-moving consumer goods (FMCG) companies and other consumption-linked businesses, where valuations are more reasonable than many mid-cap and small-cap segments. He pointed out that capital goods, hotels, hospitals and auto ancillary companies dominate mid-cap indices and continue to trade at demanding valuations, even as their business performance remains healthy. The fund continues to hold exposure to capital goods, power equipment, auto ancillaries, electronics manufacturing services and defence, supported by structural demand trends.
According to reports from CNBC TV18, improving nominal gross domestic product (GDP) growth and coordinated measures by the government and the central bank are supporting consumption and financial services. Devalkar noted that the transformer market remains supply constrained globally, benefiting Indian manufacturers. While constructive on consumption, the fund has not turned negative on manufacturing, with the long-term story continuing despite potential valuation-driven corrections. He warned that elevated valuations could lead to corrections, with any negative news potentially triggering sharp reactions in stocks that have delivered strong gains.
As reported by CNBC TV18, Devalkar emphasized that investors should continue to focus on earnings and valuations rather than market narratives, noting that sectors tend to perform when improving fundamentals are accompanied by reasonable valuations. The fund's positioning reflects a balanced approach, maintaining exposure to manufacturing themes while capitalizing on consumption opportunities, with the risk-reward profile remaining favorable in large-cap segments supported by stronger earnings delivery expected over the next few quarters.
