Brokerages say the current environment reflects a shift from panic-driven selling to selective positioning. While the immediate escalation risk has eased, volatility tied to headlines is expected to continue, especially given the uncertainty around shipping flows through the Strait of Hormuz and the possibility of renewed tensions.
Nomura said markets are now pricing in rapid swings between escalation and de-escalation scenarios, and advised maintaining balanced portfolios amid these binary risks.
Against this backdrop, analysts have identified about 50 stocks across sectors as potential bets for the next phase of the market. The recent correction, combined with improving earnings visibility, has created opportunities in companies with strong balance sheets, pricing power and domestic demand exposure.
Kotak Equities highlighted names such as DLF, Godrej Consumer, Info Edge, Aadhar Housing Finance, Eureka Forbes, Jubilant FoodWorks, Coforge, Dixon Technologies and Vishal Mega Mart as beneficiaries of a recovery in consumption and urban demand, while Embassy REIT offers stability through yield-backed returns.
Motilal Oswal’s picks include large, well-established names such as Bharti Airtel, SBI, ICICI Bank, M&M, Titan, Infosys, IndiGo and BEL, alongside broader plays like Tata Steel, TVS Motor, Indian Hotels, AU Small Finance Bank, Delhivery and Premier Energies. The brokerage sees the recent correction as a reset in valuations rather than a deterioration in long-term fundamentals.
Elara Securities pointed to a mix of largecaps including HDFC Bank, L&T, Maruti Suzuki, Axis Bank and Polycab, along with midcaps such as United Spirits, GMR Airports, UNO Minda and IDFC First Bank. Smaller names like Gland Pharma, BEML and Safari Industries also feature in its recovery basket.Axis Securities and Emkay Global echoed similar themes, favouring financials, consumption and industrial cyclicals such as Bajaj Finance, Kotak Mahindra Bank, Avenue Supermarts, Nestle India, Kalpataru Projects and Ashok Leyland. UBS, meanwhile, identified a blend of defensives and commodity-linked names including Reliance Industries, NTPC, Sun Pharma and Adani Ports as relatively better placed in a volatile oil environment.
The broader takeaway is that while the ceasefire has reduced immediate downside risks, markets are still trading with a geopolitical risk premium. Oil remains the key variable, with its trajectory influencing inflation, interest rates and corporate margins.
For now, brokerages are positioning for a recovery that is conditional rather than assured. The next leg of the market will depend not just on the durability of the ceasefire, but also on how quickly global risk sentiment stabilises. Until then, stock-specific opportunities are likely to dominate over broad-based rallies.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)