After a year of steep underperformance, India’s equity market could be poised for a turnaround, HSBC said on Friday. The foreign brokerage said valuations have corrected to historical averages, inflation is easing, and corporate earnings appear near their bottom, setting the stage for a recovery.

HSBC, which recently upgraded India to overweight in its regional strategy, said Indian equities lagged emerging markets by 32 percentage points between September 2024 and now, the weakest spell since 2001. “In cricketing terms, we expect India to return to form,” it said. Advertisement

A comeback by foreign portfolio investors (FPIs) looks likely, HSBC argued, pointing to three drivers. First, flows into Korea and Taiwan are now crowded, having been funded by earlier selling in India, and coul

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