Speaking to ETNow, Kohli noted that market volatility has grown significantly, with companies being rewarded or punished based on quarterly performance. Stocks that disappointed in Q3 were “beaten like anything else,” while delivering strong numbers that make sense.
He said: “Where the numbers are good, we have seen a slight decrease. We believe that maybe three-thirds of the numbers have gone for the broader market, four-fourths will also be a good number, and therefore the market will recognize these good numbers and start taking advantage of them.”
Highlighting his portfolio performance, Kohli revealed that across 30 holdings, revenue growth was around 20%, EBITDA growth at 29%, and PAT growth at 40%. Its strong earnings delivery led to a four- to five-percentage-point outperforming of the broader market, particularly after sharp declines in December and January and a strong recovery in early February.
On microfinance-linked stocks, Kohli acknowledged that the sector has faced persistent challenges over the past two years. While the regulatory watchdog had begun to stabilize and regional issues such as Karnataka and Tamil Nadu had subsided, fresh concerns emerging from Bihar renewed tensions. He explained that Microfinance Institutions (MFIs), which cater to vulnerable borrower segments, face regulatory and political interference.
Although the rules technically exclude registered NBFCs and banks, ground-level realities make it difficult to make distinctions at the time of collection, affecting sentiment and growth expectations. Kohli prefers companies that are transitioning from pure MFI exposure to more diversified lending models, such as microfinance banking structures. However, he cautioned that northern-based lenders with high regional exposure may face near-term pain.
In the IT sector, Kohli remains cautious despite significant valuation corrections. He believes that much of the dating has already happened, but AI-led disruption and uncertainty about global demand, particularly in the US, make new capital deployments premature. While management’s commentary was optimistic, he emphasized that execution was a significant change.
“We believe there are other relatively better sectors as of now, so we should look at those sectors instead,” he said.
The key question, he said, is whether IT companies can adapt AI to improve efficiency without reducing billing revenue. If AI reduces workforce requirements for customers, companies must demonstrate cost savings that translate into stable or improved margins. Kohli prefers to wait for substantial evidence in the quarterly numbers before reconsidering the disclosure.
In the auto space, Kohli expressed a clear preference for commercial vehicles (CVs), citing strong recent data and positive momentum for OEMs like Tata Motors and Ashok Leyland. However, instead of investing directly in major OEMs, he prefers mid-cap subsidiaries – including forging companies, axle manufacturers, spring manufacturers, and CV-focused tire players.
In both types of vehicles, he sees TVS Motors as a top performer in segments including EVs, and supports related companies that benefit from its growth.
