Top experts see upside in Indian stocks as FIIs return

Listen to this article in summarized format Listen Loading... × × Subscribe to Unlock AI Briefing and Premium Content New Year Offer 24 Hours Left Subscribe Now Already a member? Sign In What's Included Exclusive Stories Daily ePaper Access Smart Market Tools Curated Investment Ideas Ad-lite Experience Subscription Agencies Mumbai: Global brokerages HSBC, Citigroup and Jefferies have turned more bullish on Indian equities, citing improving earnings prospects, attractive valuations, and the potential for foreign fund inflows as the market stages a sharp recovery. HSBC Holdings has upgraded Indian equities to Overweight from Neutral, citing resilient corporate earnings and more reasonable valuations. "India offers diversification and low volatility in Asian markets dominated by AI stocks," HSBC said in its latest note. The brokerage favours banks, industrials, consumer discretionary companies, insurers and hospitals. Citigroup expects the Nifty 50 to reach 28,000 by end-2027, citing a strong earnings outlook, lower oil prices and the prospect of slower artificial intelligence-related capital expenditure as factors supporting Asian equities. The target implies an upside of 12%. Read more: Can Nifty hit 28,000 before 2028? Citi raises target, sees $12 billion inflows Jefferies has raised India's weight in its Asia-Pacific ex-Japan relative-return portfolio by two percentage points to 14% from 12%, while retaining its Overweight stance. The brokerage has also cut its allocations to South Korea and Taiwan by one percentage point each, maintaining Underweight positions in both markets. Live Events The upgrades come amid a sharp recovery in Indian equities, supported by lower crude oil prices, a correction in AI-related stocks across global markets and renewed foreign investor buying. Foreign investors have bought around $4 billion worth of Indian equities during the recent rally. Read more: Mid and smallcap stocks could see strong gains in 2027, but expect volatility, says Deepak Shenoy, Capitalmind Mutual Fund Since October 23, the Sensex and Nifty have gained 10.8% each, while the BSE 150 MidCap and BSE 250 SmallCap indices have advanced around 8% each. Citigroup sees significant scope for foreign investor positioning in India to recover. A one-percentage-point increase in active fund allocations to the country could generate around $12 billion in inflows, according to the brokerage. The brokerage expects Nifty earnings to grow 15-16% annually in financial years 2026-28. It also estimates that a $10 decline in crude oil prices could boost Nifty earnings per share by around 2%, supporting corporate profitability and economic growth. Add as a Reliable and Trusted News Source Add Now! (You can now subscribe to our ETMarkets WhatsApp channel ) Read More News on India equities foreign fund inflows Jefferies investment strategy Citigroup forecasts HSBC Holdings (What's moving Sensex and Nifty Track latest market news , stock tips , Budget 2025 , Share Market on Budget 2025 and expert advice , on ETMarkets . Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today . Top Trending Stocks: SBI Share Price , Axis Bank Share Price , HDFC Bank Share Price , Infosys Share Price , Wipro Share Price , NTPC Share Price ... more less (You can now subscribe to our ETMarkets WhatsApp channel ) Read More News on India equities foreign fund inflows Jefferies investment strategy Citigroup forecasts HSBC Holdings (What's moving Sensex and Nifty Track latest market news , stock tips , Budget 2025 , Share Market on Budget 2025 and expert advice , on ETMarkets . Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today . Top Trending Stocks: SBI Share Price , Axis Bank Share Price , HDFC Bank Share Price , Infosys Share Price , Wipro Share Price , NTPC Share Price ... more less Prime Exclusives Investment Ideas Stock Report Plus ePaper Wealth Edition Business of Odd Things: The farm that needs no land, freshwater, or fertiliser KYC and KYB: Inside Pidilite, the company that turned Fevicol into a word for a strong bond – Part 1 of 3 Seoul halts trading, Nifty has its best week since 2021: Money leaving the AI trade – will it land in India? Junk bonds are cracking at the bottom. Will the noise get loud enough to make ‘junk bond’ a household term again? PNG connections rise half a million, but how many use piped gas for cooking? Some elections matter more than you know: No crop changed in the fields, yet sugar, coffee and soya got cheaper in a day 1 2 3 View all Stories