Vikas Khemani, the founder of Carnelian Asset Management, has outlined his investment strategy during the ongoing market turbulence, focusing on mid and large-cap stocks while making selective contra bets. His most notable investment is in IndiGo, which he sees as a market leader in the airline industry with minimal competition expected in the next five years. Khemani believes that the current market dip presents a valuable buying opportunity for the airline's stock.

In the power sector, he favors conventional energy stocks like BHEL over renewable energy options, which he views as facing intense competition. He maintains that strong power demand driven by industrial growth and the global data center boom will support these investments.

When it comes to banking, Khemani has increased his positions in public sector banks during market corrections but remains optimistic about select private banks like ICICI Bank and Federal Bank. He emphasizes that the focus should be on individual stock performance rather than the public versus private debate.

Despite market volatility, Carnelian has not adjusted its portfolio towards larger market caps, believing that challenging market conditions can create favorable entry points for smaller companies. Khemani also advises against investing in companies whose risk-reward profiles are unclear, highlighting the importance of understanding management quality in investment decisions. Overall, his strategy is centered on conviction, quality, and patience, aiming to capitalize on beaten-down market leaders while avoiding short-term market noise.