"With no material change in earnings estimates and no visible evidence suggesting the risk of consensus earnings downgrades – seen over the past three consecutive years - is now firmly behind us, the liquidity-driven expansion in valuations looks unlikely to sustain," Abhay Laijawala of Deutsche Bank says.
Laijawala further says while he remains excited about the roll-out of the GST (Goods & Services Tax) in July, he sees this impacting consensus earnings in second half of FY18 following the rollout.
His top largecap picks are Aurobindo Pharma, BPCL, Maruti Suzuki, NTPC, SBI, Shree Cement, Tata Motors, TCS, Tech Mahindra and Vedanta India.
Top midcap picks are CESC, M&M Financial, Petronet LNG, Ramco Cements, Shriram Transport and UPL, Laijawala says.
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