Indian equities have become more attractive following a sharp valuation correction, with Motilal Oswal Financial Services (MOFSL) said in a recent report.
The brokerage expects earnings growth to remain healthy despite global uncertainties, although it cautioned that stock selection will be crucial as market performance increasingly depends on individual companies’ earnings trajectories.
MOFSL expects aggregate profit after tax across its coverage universe to grow 22% year-on-year in the September 2026 quarter, marking the highest growth in 11 quarters. Excluding oil marketing companies, earnings are projected to rise 24%, while Nifty-50 earnings are expected to increase 27%.
“India’s ongoing market consolidation, alongside continued earnings recovery from FY25 lows, has led to a sustained cooling in valuations from the highs seen in 2024. Large- and mid-caps have witnessed the steepest valuation corrections of 31% and 36%, respectively, from their respective peaks,” MOFSL said.
It identifying opportunities across banking, financial services, technology, manufacturing, automobiles, consumption and healthcare stocks.