High valuations will cap the upside: Gautam Duggad of Motilal Oswal

High valuations, particularly in the mid-cap space, will limit the upside for the markets, says Gautam Duggad, head of research, Motilal Oswal Institutional Equities. In an interview with Samie Modak, Duggad also says rural-focused stocks can be a good play in an election year. Edited excerpts:
 
How has the earnings season panned out so far?
 
So far the earnings season has been in line with the estimates, excluding the Axis Bank, which reported a significant rise in provisions and slippages. We expect corporate-oriented banks to report muted and volatile asset quality. We would advocate that investors, who look