Insights from Datt Capital’s Investor FY26 Webinar

The financial year ahead is shaping up to be one of both challenge and opportunity. On 23 July 2025, nearly 100 wholesale investors joined Emanuel Datt, CIO of Datt Capital, for our FY2026 Market Outlook webinar. The discussion explored the forces shaping markets, the sectors best positioned for resilience, and how our portfolio is responding.

Navigating an Uncertain Global Environment

Emanuel began with a candid assessment of the macroeconomic and geopolitical landscape. The Reserve Bank of Australia recently trimmed the cash rate from 3.85% to support growth, even as wage pressures and services inflation remain elevated. Globally, major central banks are moving at different speeds, creating a divergence in monetary policy not seen for many years.

Meanwhile, geopolitical risk remains high. From trade policy shifts in the United States to regional conflicts in the Middle East and Asia, the backdrop for investors is complex. Yet, markets have so far shown resilience, supported by low unemployment and strong liquidity conditions.

For investors, the question is clear: how do you position portfolios when the economic picture is neither boom nor bust, but something more nuanced?

Small Caps: An Opportunity Hiding in Plain Sight

While Australian equities have pushed towards record nominal highs, Emanuel noted that when adjusted for inflation, the market still sits about 15% below its 2007 peak. This anomaly becomes even more striking when comparing small‑cap valuations to large‑caps.

“Small cap earnings multiples remain at a material discount to large caps, something highly unusual historically,” Emanuel explained.

“Small cap earnings multiples remain at a material discount to large caps, something highly unusual historically,” Emanuel explained.

For investors, this opens the door to opportunities in high‑quality businesses trading below long‑term averages.

Sectors Poised for Growth

Technology featured prominently in the discussion. Rather than chasing speculative AI stocks, Emanuel highlighted the potential in companies positioned to benefit from the adoption of AI, such as those reducing operational costs through automation.

Gold was another area of focus. With ongoing currency debasement and stimulus settings, gold continues to serve as a reliable store of value in uncertain times. Critical metals, driven by demand for robotics and advanced manufacturing, were also identified as an area of interest.

By contrast, Emanuel flagged caution in private credit, REITs tied to residential developers, and consumer discretionary, all facing structural or cyclical headwinds.

A New Portfolio Holding: MONASH IVF

Investors also heard about a new addition to the portfolio: MONASH IVF (ASX:MVF), a market leader in fertility services across Australia and Southeast Asia. Despite recent operational challenges, decisive board action and strong fundamentals made the stock compelling at valuations well below its 52‑week peak.

“We saw Monash IVF as a market leader in a defensive sector with strong demographic tailwinds. The board’s decisive action and the opportunity to invest at a significant discount reinforced our conviction in its long-term potential.” - Emanuel Datt.

“We saw Monash IVF as a market leader in a defensive sector with strong demographic tailwinds. The board’s decisive action and the opportunity to invest at a significant discount reinforced our conviction in its long-term potential.” - Emanuel Datt

For Emanuel, the investment thesis rests on governance, defensive sector exposure, demographic tailwinds, and potential re‑rating over time.

Closing Perspective

The webinar concluded with a strong message: disciplined portfolio construction has never been more important. Australian equities, particularly small caps, appear well‑placed to deliver long‑term value.

“Our process is designed to identify quality companies that are resilient, independent of short‑term noise, and aligned with long‑term investor outcomes,” Emanuel said.

“Our process is designed to identify quality companies that are resilient, independent of short‑term noise, and aligned with long‑term investor outcomes,” Emanuel said.

If you missed the live session, the full webinar replay is available upon request through our Head of Distribution, Daniel Liptak, at daniel@datt.com.au or 0419 004 524.

Datt Capital continues to provide disciplined, independent insights designed to support our wholesale investors. Explore our Funds or contact our team to discuss how our strategies may align with your investment goals.