As markets prepare for a potential rotation away from large caps, experts highlight where the next wave of money could flow. Small Finance Banks (SFBs) are emerging as strong contenders, having cleaned up balance sheets, raised fresh capital, and now trading at attractive valuations. Mid-cap banks with meaningful SFB exposure - such as RBL and IndusInd - also stand to benefit from this trend. Beyond financials, IT is regaining attention as the U.S. economy stabilises and the sector recovers from recent underperformance. With improving global demand and stronger India–U.S. alignment, IT may see renewed traction in upcoming quarters. Overall, SFBs, mid-cap banks, and IT appear to be the prime beneficiaries of a shift away from large-cap-heavy positioning.

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