IT sector faces more heat after Trump tariffs; Mayuresh Joshi backs hospital stocks

Mayuresh Joshi, Head of Equity Research at William O'Neil India, has expressed caution over the outlook for India's information technology (IT) sector, citing ongoing sectoral challenges and external pressures, particularly from the United States.

The market expert pointed out that the IT segment could remain under stress, especially after US President Donald Trump imposed an additional 25 per cent tariff on Indian goods, raising the total tariff burden to 50 per cent.

"The IT sector is going through its own problems. There are multiple issues as far as their earnings trajectory is concerned. With tariff impositions, how does it impact discretionary spending going forward for various industries? That is a trend that everyone would like to see. Therefore, IT might still be an underperformer," Joshi said in an interaction with Business Today on Thursday.

Given the global uncertainty, Joshi advised investors to focus on select domestic-facing sectors. "If the market does correct, I think a few domestic sectors will continue doing well. Consumption is expected to pick up and selective FMCG stocks might make a strong comeback," he noted.

Among domestic themes, Joshi remains particularly optimistic about the hospital sector. "Fortis Healthcare Ltd continues to be our top pick in this space. The company delivered a strong set of numbers. Its ongoing expansion, coupled with improving core fundamentals and better return ratios, is expected to drive performance going forward," he noted.

He also highlighted Global Health Ltd, which operates the Medanta chain of hospitals, as a stock to watch. "Medanta is also in expansion mode and margins are expected to be in the 25–26 per cent range. Return ratio is expected to be strong. So, these two hospital stocks remain at the top of our radar," Joshi stated.