Credit Suisse trims India overweight to 10 pct from 15 pct versus emerging market benchmarks.
Cites India’s outperformance in 2014 and the over-exposure of emerging market funds as key reasons.
NSE index gains 36.2 pct so far this year as on Friday’s close, making India the best-performing Asian equity market, according to Thomson Reuters data.
However, the investment bank adds India is not fully valued.
Says further improvements in macro, earnings and an attractive currency can drive future performance.
Adds multiple expansion to continue, supported by disinflation and a further pickup in growth.
Credit Suisse highlights India still offers the highest earnings growth outlook among all emerging markets.
The investment bank says its macro regression model suggests a 39 pct potential upside to Indian stocks.
Also, it says the external position appears strong and the rupee is attractively placed within emerging market currencies.