Indian stock market remains attractive for long-term investors
Indian equities may remain range-bound in the near term, but long-term outlook remains positive, backed by strong economic fundamentals and structural growth drivers, a report said on Thursday.
The report from PL Wealth recommended staggered investments in quality large?cap and large?and?mid?cap strategies for short?term investors.
As inflation pressures ease and external headwinds decline over the medium term — six to 24 months — domestic growth drivers should support a broad?based earnings recovery, allowing investors to increase allocations to large?cap, large?and?mid?cap and sectoral strategies.
The report said markets are expected to be range?bound and driven by events such as crude oil prices, inflation trends, the monsoon, geopolitical developments and changes in earnings expectations.
As short?term earnings revisions remain under pressure in some sectors because of higher production costs and a difficult global backdrop, selective stock picking is preferable to broad market exposure.
“India continues to be an outlier among the leading economies of the world because of the robust nature of the domestic economic growth engines like consumption, production, infrastructure spending and the growing trend of savings being financialised,” said Inderbir Jolly, CEO, PL Wealth.
On fixed income, the firm said that investors should focus on short?duration and medium?term instruments that offer a balanced risk?reward profile due to higher inflation expectations and a high interest?rate environment.
Gold is gaining importance as a strategic reserve metal against the backdrop of rising geopolitical uncertainties and ongoing concerns about inflation. Central banks' purchases and efforts of sovereign investors for diversification are likely to underpin the prices of gold on a structural basis going forward.
Equity market performance has grown more selective in nature, where investors favour companies showing visible earnings, healthy balance sheet and good growth potential.
India's economic performance continues to be strong, with the manufacturing and service PMI figures of 55.0 and 59.8, respectively, in May 2026, far better than that of most other major economies around the world, the report noted.
