CLSA Predicts Muted Indian Market Returns in 2026, Favors Consumption and Real Estate

• CLSA's Vikash Kumar Jain expects moderate Indian market returns in 2026, despite reduced valuation premium making it attractive to global investors.
• 2026 will see fewer policy announcements and limited fiscal/monetary action compared to 2025, with a focus on fiscal consolidation.
• CLSA has increased its focus on consumption, including retail and quick commerce, and maintains an overweight stance on discretionary spending, staples, and select auto names.
• Real estate is another preferred sector, supported by lower-for-longer interest rates, expected to benefit even if market returns lag earnings growth.
• High single-digit gains on Nifty 50 are the best-case scenario for 2026, with a gradual de-rating phase where valuations compress while earnings grow.

Why It Matters: CLSA forecasts moderate Indian market returns in 2026, prioritizing consumption and real estate sectors.