Expect 20% earnings growth for Nifty in FY19; time to pick stocks, says Ashmore Investment Management

The big drivers for this growth are going to be the industrial banks, where one is noticing some stabilization in slippages and the provisioning requirement could fall of significantly in Q3, Q4.

Consumption space is expected to see good demand along with healthcare space, where earnings are bottoming out and growth will come back going forward.

“So, growth is very well spread. There is high quality growth not coming from other income and from unsustainable drivers. What is exciting is the broad-based growth, strong balance sheets that companies have and the fact that business activity is beginning to look up,” he said.

For the FMCG companies, he said,"The growth should be looked at on a sequential basis, adding that on a broad range of consumer facing businesses like automobile, farm equipment, consumers’ one is seeing reasonable traction in growth. So, the consumers seems to be in a good shape."

"According to their global expert, if you fundamentals think of emerging markets today then external balances, trade deficits are much stronger than what they were anytime over the last 10 years," he added.

However, he is not too perturbed yet with slowdown in the June sales numbers of auto companies like Maruti, Eicher Motors and would prefer to wait for a few months for a trend to emerge and not read into just one month’s figures.