Credit Suisse, Nomura remain bullish on Indian markets; top 9 stocks to bet on

NEW DELHI: Despite a sharp 30% run-up seen in the Sensex in the calendar year 2014, analysts at top global brokerage firms maintain their bullish stance on the Indian markets, on the hopes that India’s macro environment will improve and interest rates will move down further.

Credit Suisse is the latest to join the party in reconfirming its stance on the Indian equity markets after Nomura, which raised the Sensex target for the December-end to 33500 earlier this week. Credit Suisse maintains ‘overweight’ on the Indian equity markets despite rising premium over APAC. MSCI P/BV vs ROE is at a 54% premium to Asia Pacific. Rising ROE and falling COE were major factors behind Credit Suisse's overweight stance.

The BSE index is up 8.6% in US dollar terms in 2015 so far, and is also Asia's best performing equity index, as per Thomson Reuters Eikon data.

Earlier this week, Japanese brokerage firm Nomura said its bullish stance on the Indian market for this year is based on the view that improvement in India's macro environment over the past year has been "durable" and will improve further.

"Our December-end 2015 Sensex target of 33,500 offers around 20 per cent potential upside from the current levels," Nomura said in a research note.

"We expect market confidence in the sustainability of currently low inflation numbers to strengthen further through the year and believe interest rates are poised to fall further," Nomura said, adding that "growth momentum is already showing signs of improvement, which should be reflected in actual data through the year".

According to Nomura, sector-wise, financials, auto, industrials and technology are looking bullish, while consumer staples, pharmaceuticals, metals and telecom look bearish.

We have collated a list of investment ideas by both global brokerage firms for the year 2015: