US brokerage Goldman Sachs has upgraded its rating on Indian stocks to “overweight” citing improving domestic economic data and expectations linked to the upcoming general elections. It expects the NSE Nifty to touch 7,600 points this year — a 17% upside from current levels.
“Upcoming Parliamentary elections in April could have an important impact on reform progress,” the report said.
Historically, Indian equities have fared well in the run-up to the elections. “Our analysis of past election moves, valuation and flows suggests India may have more room for a pre-election rally than Indonesia,” the report says.
Goldman said GDP growth has bottomed out in the first quarter and picked up going forward.
It is bullish on IT and energy as well as autos.
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