Such a shift would mark a sharp turnaround for Indian equities after months of foreign capital flowing into markets seen as bigger beneficiaries of the artificial intelligence boom. HSBC believes those trades are becoming increasingly crowded, while heightened volatility across AI-linked markets makes India a more attractive diversification bet for global investors.
And to lead that shift, HSBC has selected 10 stocks
1 – ICICI Bank – The brokerage has pegged the target at Rs 1,700 for India’s second-largest private lender. The brokerage prefers the lender for its consistent earnings profile, supported by strong loan growth, stable net interest margins and pristine asset quality. The brokerage also cited the bank’s strong liability franchise, superior management of margins and operating metrics compared with peers, and greater clarity on management continuity.
The brokerage also highlighted the bank’s operating leverage, robust capital position and high provisioning buffer, which it believes provide adequate protection against macroeconomic and asset quality risks.
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2 – Cholamandalam Investment – The brokerage has assigned a target price of Rs 2,140 per share. The brokerage prefers the stock among NBFCs, favouring large, diversified lenders over lower-rated monoline players, particularly those with high rural exposure. The brokerage said the company remains in an earnings upgrade cycle, supported by healthy growth in its vehicle finance business, rapid scaling up of non-vehicle finance segments and benign asset quality trends. It also highlighted that the company continues to deliver more than 20% growth in disbursements, while maintaining what it described as a best in class earnings profile among large NBFCs.3 – Titan Company – With a target price of Rs 5,290, HSBC said the outlook for India’s jewellery segment remains relatively stronger than the broader consumption space, supported by the continued shift from the unorganised to the organised market, which benefits Titan. The brokerage noted that while a sharp correction in gold prices could temporarily impact demand, it expects a strong recovery thereafter, driven by higher customer footfalls and buyer growth. Backed by favourable industry trends and the company’s best-in-class execution, HSBC believes Titan remains India’s dominant consumer franchise with strong long-term growth visibility.
4 – M&M – HSBC has a target price of Rs 4,200 on Mahindra & Mahindra, saying the company remains one of its preferred picks in the auto sector. The brokerage noted that passenger vehicle demand has stayed strong in recent months despite higher fuel prices and vehicle price hikes. While most automakers faced margin pressure in the first quarter and similar challenges are likely to persist in Q2FY27, HSBC remains positive on the sector.
It believes M&M stands out as one of the world’s more efficient auto OEMs, backed by a strong record of successful product launches. The brokerage expects the company to continue outperforming peers, supported by new models on its NU platform and improving exports driven by capacity expansion.
5 – Phoenix Mills – HSBC has a target price of Rs 2,450, highlighting the company as one of India’s leading mall operators with a portfolio of 12 malls across eight cities. The brokerage views Phoenix Mills as a play on India’s premium consumption story and noted that the company is expanding beyond malls into a mixed use real estate developer with interests in hotels, offices and residential projects.
HSBC said the company enjoys a strong competitive moat in mall management, enabling it to generate higher trading density than peers and command superior rentals. It also highlighted the turnaround in Phoenix Mills’ legacy malls through continuous upgrades, with consumption growing more than 25% over the past three quarters.
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6 – Fortis Healthcare – HSBC has a target price of Rs 1,200 on Fortis Healthcare, saying the hospital chain has entered a new phase of growth. The brokerage expects strong earnings visibility, driven by an improving case mix at its leading hospitals, rising profitability at hospitals with EBITDA margins below 15%, and calibrated capacity expansion. Fortis plans to add 645 beds over the next two years through brownfield expansion. HSBC also sees additional upside from the potential integration of Gleneagles hospitals into the Fortis network, which could deliver further scale benefits.
7 – Adani Ports and Special Economic Zone (APSEZ) – HSBC has a target price of Rs 2,200 and describes the company as a de-risking and compounding story. The brokerage said governance concerns have eased following stronger disclosures and balance sheet deleveraging, with net debt to EBITDA improving to 1.9 times in FY26. HSBC highlighted APSEZ’s competitive advantage through its network of 15 ports across both coasts and its vertically integrated logistics and marine businesses, which make cargo flows more sticky and accounted for 53% of FY26 volumes. The brokerage noted that the company’s share of India’s port throughput has risen from 14% in FY16 to 27% in FY26, supporting resilient earnings and potential for further valuation re rating.
8 – Cummins India – HSBC has a target price of Rs 6,500 and views the company as a key beneficiary of India’s long term infrastructure, manufacturing and industrial capital expenditure cycle. The brokerage said Cummins is well positioned due to its leadership in power generation solutions and its large installed base. It also expects the company to benefit from the rapid expansion of data centres, given its strong position in high horsepower backup power solutions used in data centre applications.
9 – Hindalco – HSBC has a target price of Rs 1,430 on Hindalco Industries, remaining constructive on the outlook for aluminium. The brokerage said industry fundamentals remain strong, supported by a 45 million tonne capacity cap and resilient demand from mainland China. It added that tight supply conditions, coupled with prolonged tensions in the Middle East, which accounts for around 8% to 9% of global aluminium output, could provide further upside to aluminium prices.
While a prolonged conflict could weigh slightly on demand, HSBC does not expect it to materially alter the demand-supply balance. Against this backdrop, it believes Hindalco’s India business is well positioned. The brokerage also noted that the stock has corrected 15% from its May peak, making its valuation more attractive.
10 – Syrma SGS – The foreign brokerage has a target price of Rs 1,750 on Syrma SGS Technology, highlighting the company as one of India’s leading electronics manufacturing services (EMS) players. The brokerage expects the sector to benefit from the government’s continued push for domestic electronics manufacturing, including the around $13 billion allocation approved in June for India Semiconductor Mission 2.0, which it believes will have a positive trickle-down effect on EMS companies.
HSBC said Syrma’s growth is supported by strong demand across multiple segments, particularly automobiles and industrials, along with its diversified global customer base. It also expects the company’s high export mix, focus on high engineering and low volume products, and vertically integrated manufacturing capabilities, from printed circuit boards to box build solutions, to support long-term margin expansion.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
