CLSA expects Indian equities to gain nearly 16% by December 2026, noting that the market is emerging from a prolonged adjustment phase and is now shaping a more stable base for long-term profitability. Over the past 14 months, expectations around GDP growth, earnings estimates and the currency have all been revised downward. Yet, CLSA believes the market has reached a stage where earnings visibility is improving, supported by better resilience to foreign outflows and a decline in record equity supply.
The firm also observed a shift in global investor behaviour: India is increasingly viewed as a safe haven in a climate dominated by AI-driven market trends, rather than purely on domestic fundamentals. Although CLSA’s India exposure is lower than earlier in the year, its models still project a 16% upside by end-2026.
It added that the heavy equity issuance seen in 2025 has likely peaked, easing liquidity pressure, while India’s valuation premium has moderated.
CLSA also revealed 13 high-conviction “Tiger picks,” including NHPC, which it expects to deliver strong EPS growth and a significant ROE improvement by FY27, backed by major hydro and renewable energy developments.
