There will be a strong bounce back in quality small and midcap companies over six months, said Sunil Subramaniam, MD and CEO of Sundaram Mutual Fund.

According to Subramaniam, the service sector contributes 50 percent to the gross domestic product (GDP) and there is a big opportunity for investing in the service sector.

When the sector is already at more than 50 percent, the fact is that the scope for 54 percent to go towards 70 percent is very strong, he said. The second aspect is that the service sector contributes 54 percent of the gross domestic product (GDP), it is only 35 percent of the market cap of the country, he added.

"So what we see is that over a period of time, this 35 percent is going to approach 50, while the 54 will approach 70," Subramaniam said.

First Published:Aug 24, 2018 12:08 PM IST