Earnings growth to play larger role in determining portfolio returns than valuation re-rating: Nilesh Shah

Earnings growth is expected to become a more significant factor in determining portfolio returns than changes in stock valuations. This shift in focus is due to the fact that Indian equities currently have valuations that are neither extremely low nor extremely high. As a result, investors will likely place more emphasis on the growth prospects of companies when making investment decisions, rather than relying on potential valuation increases.

Why it matters

Earnings growth is expected to be a key factor in determining portfolio returns, as valuations of Indian equities remain high. This shift in focus can lead to more stable market performance.

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