The preferred games of the brokerage for the rebound are Lodha, Cholamandalam, Adani Energy, Shriram Finance, Jubilant Foodworks, Mankind Pharma, NTPC and Crompton Greaves Consumer Electrics. Jefferies also repeated his “high conviction” call on cement, with reference to a prize -conducting recovery.
Jefferies noted that the MSCI India Index has chased the MSCI Emerging Markets Index by 24 percentage points in the last 12 months – the widest such gap in 15 years. “Historical trends suggest that after a significant (15-20%+) under performance, MSCI India tends to bounce relatively,” said analysts Mahesh Nandurkar, Abhinav Sinha and Priyank Shah.
Ratings back in line
The valuation premium of India for peers on emerging markets, which rose to 90% in March-April in March, has since returned to his 10-year average of 63%. Although the forward price-gain ratio of the MSCI India is still 10% above its long-term average, Jefferies said that wider measures, such as the proceeds from the proceeds of bonds, are tailored to historical standards.
Domestic buying momentum
The influx of Equity Investment Fund increased by 75% by a month by one month to $ 6.4 billion, more than double the monthly April average. Non-Mutuual Fund Domestic Institutions, including insurers, listed funds and alternative investment funds, are also net buyers, an average of $ 2.8 billion a month this year versus $ 1.6 billion in 2024. Jefferies called these flows “a great protection and a sorter protection and one strey protection.”
Foreign positioning at lows
The brokerage said that the India-movements of foreign portfolio investors are nearly dozens of lows, with large funds on emerging markets with only 0.2 percentage points that are overweight compared to the benchmark-nou below the average of 2.5 points and far from peaks above 4 points.
The profit of September Boost
Jefferies expects a strong income from the September quarter of last year to have the low basis of last year, when elections delayed government spending and from a previous Diwali this year. However, the seasonal boost will probably reverse in the quarter of December.
“However, the bounce cannot maintain long because of the weak value versus growtheering and concern about the shares,” the analysts warned.
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((Indemnification: Recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of economic times)
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