India has now become the most preferred stock market in Asia for fund managers, overtaking Japan, according to a recent survey by BofA Securities. This shift reflects growing confidence in India’s ability to benefit from global supply chain changes, trade tensions, and strong domestic demand.
In the monthly fund manager survey, 42% of respondents said they are overweight on India, meaning they expect higher returns from Indian stocks compared to other Asian markets. Japan followed with 39%, while China lagged at 6%. Thailand was ranked the lowest among the Asian markets.
The survey included 109 fund managers handling assets worth US$234 billion. The results suggest that global investors see India as a stable and promising market during uncertain global trade conditions.
According to the survey, India is expected to gain from global supply chain realignments caused by tariffs and trade tensions. Fund managers are also closely watching two key sectors in India: infrastructure and consumption.
In addition, India’s economy depends more on domestic consumption than exports, making it less vulnerable to global shocks. This has made Indian markets a more attractive option for investors seeking safer opportunities.
India’s stock benchmark, the Nifty 50 Index, has performed better than most of its Asian peers since April 2. Only Japan and Indonesia have done better. This strong performance comes even after political tensions with Pakistan caused a short-term dip in markets.
However, a ceasefire agreement between India and Pakistan on May 10 helped improve investor sentiment, pushing stocks higher at the start of the week.
Indian companies are also showing signs of strong earnings growth in the first quarter of the financial year. As per news reports, the market could grow another 7.6% by year-end, supported by better liquidity, tax cuts, and strong rural demand.
India’s growing appeal to global fund managers shows increasing confidence in its economic strength and resilience. With positive market trends and an improving earnings outlook, India appears to be well-positioned for further growth in 2025.
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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.
Published on: May 16, 2025, 3:44 PM IST
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