- The short — delta view since Monday
- Shift/Explain grid (what shifted & why)
- Rotation update & risk flags
- Breadth & revisions quick read
- Position sizing & exits (liquidity-aware)
The short (delta since Monday)
- Leadership holds: Banks / Capital Goods retain RS lead; pullbacks shallow and bought.
- Improvers: Power and select Autos extend gains; Pharma steady on margin resilience.
- Cooling: IT mixed—premium names need TCV + ramps to sustain multiples.
- Breadth: Smallcap breadth off extremes; liquidity pockets thinning in microcaps.
- Play: Maintain OW Banks/Cap Goods; Neutral Power/Autos/Pharma; UW frothy Discretionary & illiquid smallcaps.
Shift / Explain grid
| Move | Driver | Why it matters | Action |
|---|---|---|---|
| Bank RS ↑ | Stable spreads; benign credit costs | Confirms durable earnings path | Hold OW; add on orderly dips |
| Cap Goods ↑ | Execution cadence; sturdy orderbooks | Revenue conversion beats narrative | Favor diversified EPC & product mixes |
| IT mixed | Delayed ramps; cost-takeout mix | Multiple needs TCV + dates | Stick to delivery proof; avoid hope-premium |
| Power steady | Tariff clarity; demand | Receivables stabilising helps FCF | Blend regulated + merchant stacks |
| Smallcaps breadth ↓ | Profit-taking; event risk | Day-2 liquidity fade risk | Reduce crowded, low-float names |
Rotation update & risk flags
| Sector | Status | Primary driver | Risk trigger | Positioning cue |
|---|---|---|---|---|
| Banks | Leader | Credit growth + AQ | Deposit beta spike | Prefer OCF/EBITDA >0.8; lower wholesale mix |
| Capital Goods | Leader | Backlog → revenue | Input cost creep | Diversified orderbooks; avoid single-client |
| Autos | Improving | Festive sell-through | Dealer weeks >6 | Trim if inventory builds |
| Pharma | Improving | US launches; India steady | US price erosion | Prefer clean plants + ANDA pipeline |
| IT | Cooling | Ramp delays | Macro scare | Cost-takeout winners only |
| Power | Improving | Tariffs; demand | Fuel bottlenecks | Blend regulated + merchant |
Breadth & revisions — quick read
- Breadth: % stocks above 50-DMA improved ex-IT; smallcap ratio easing from extremes.
- Revisions: Banks/Cap Goods net upgrades; IT mixed; Autos/Pharma gradually better.
- Liquidity: Microcap ADTV pockets thinning—size by liquidity tiers.
Position sizing & exits
- Sizing rule: Max position ≤ 5× ADTV; halve for names with event risk in 5 days.
- Exit rule: Trim a leader if underperforms Nifty by 6% over 4 weeks or if net revisions flip negative.
- Beta dial: Cut smallcap beta if A/D line rolls over for two consecutive weeks.
Positioning matrix OW: Banks, Capital Goods · N: Power, Autos, Pharma · UW: IT, frothy discretionary smallcaps.