Indian market growth will continue to create opportunities in mid- and small-cap companies despite recent corrections, Helios Capital Asset Management CEO Dinshaw Irani said on October 26, 2026. He also called for a temporary capital gains tax moratorium on new foreign inflows.

Key Takeaways

  • Irani said smaller companies in several industries offer stronger growth prospects than traditional large-cap sectors.
  • He proposed a temporary capital gains tax moratorium for new foreign inflows; it is not an announced policy.
  • He expects artificial intelligence to disrupt traditional large-cap Indian IT services companies.

Indian market outlook for smaller companies

Irani said investors have broadened their attention beyond a handful of large companies to mid- and small-cap businesses. He identified platform businesses, auto components, precision engineering and consumer discretionary companies as areas where growth rates remain stronger than in traditional large-cap sectors.

His view follows a recent correction in mid- and small-cap stocks. Irani said periods of correction would occur, but he believes their long-term growth drivers remain intact.

Growth and foreign investment proposals

Irani said India could sustain nominal GDP growth of around 10% or more over the long term, citing its young workforce and digital adoption. That is his outlook, not a reported growth result.

He argued that private-sector capital spending is important for job creation, because investment around factories and manufacturing hubs can support wider business ecosystems. He also suggested temporarily waiving capital gains taxes on new foreign inflows to help attract investment.

Stock selection and AI disruption

Helios uses an approach Irani calls “elimination investing,” rejecting companies against eight factors. The areas he identified include industry structure, management quality, governance, accounting quality and valuation.

Irani said AI infrastructure investment and adoption could create growth and efficiency gains, but he expects the technology to disrupt traditional large-cap IT services providers. He also cautioned retail investors that managing their own investments requires full-time attention.

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