According to Nilesh Shah of Envision Capital, it's big IT businesses' turn to fade while deeptech and midcap IT firms have their day

 According to Nilesh Shah of Envision Capital, it's big IT businesses' turn to fade while deeptech and midcap IT firms have their day

Nilesh Shah discussed the potential of MapmyIndia, the recent underperformance of HDFC Bank, and the recent term forecast for the Indian market, noting that foreign investors are holding off on making capital deployments until after the election.

According to Nilesh Shah, big-cap IT companies won't see double-digit growth until they completely reinvent themselves.

Big-boy IT firms are going out of style; instead, midcap and deeptech businesses will become the main players, according to Nilesh Shah, CEO and MD of Envision Capital. Shah clarified in an interview with CNBC-TV18 that big IT businesses would only see low single digit growth in the future unless they innovate and "encash on AI."

Shah mentioned businesses with long-term promise, such as MapmyIndia, which reported revenue growth of around 20% YoY and margins rising to 45% in the September quarter. MapmyIndia offers several use cases across many industries. "Take a look at their use cases; it may be widely used. According to Shah, you would directly interact with MapmyIndia in whatever industry you work with on a regular basis.

Speaking about how the world views India, Shah said that after the elections, when things are more definite, international investors are holding off on making capital investments in India. In the next months, we'll have to wait and see. The primary variable they are examining is the price of crude oil. The second is the situation in West Asia, and the third is the upcoming elections here at home, he said.

"We are more certain now than ever that there will be the kind of inflows into India that we have not seen in the past—that is, the kind of money that is waiting in the wings," Shah said after the election results.

Shah shed light on HDFC Bank's recent performance issues, pointing out that although the bank is underperforming compared to its peers, it has the potential to excel when money flows in. It was the only bank that was consistently performing three years ago. The others were still having trouble with repairs and the quality of their assets. These days, a greater number of banks, NBFCs, and specialty lenders are contributing to increased growth. They are keeping their asset quality, growing RoE, and providing 20–25 percent growth. Thus, HDFC Bank will keep doing poorly, according to Shah.