CLSA Bets on Long-Term India Story. Here Are Top Stock Picks

Benchmark indices BSE Sensex and Nifty have slumped nearly 15 per cent from the highs they registered in March. The turmoil in global financial markets following China's surprise devaluation of its currency and concerns over global growth took a toll on domestic markets. 

Domestic factors like weak corporate earnings, poor monsoon and slow pace of reforms also dented the sentiment. The uncertainty over Fed rate hike also kept investors edgy. Foreign institutional investors in August sold record Rs 16,877 crore worth of Indian shares. 

Despite the sharp correction, foreign brokerages CLSA and Barclays are optimistic on Indian markets over the long term. 

CLSA says that long-term story for Indian equities remains intact, citing structural positives of lower inflation and positive demographics. However, it expects short-term pain from earnings disappointments. From longer term perspective, CLSA sees 16-18 per cent corporate earnings growth over FY18-19 and sees markets to deliver a cumulative 30 per cent-plus return by September 2017.

CLSA's top stock picks: Bharti Airtel, ICICI Bank, HDFC Bank, Larsen & Toubro, Maruti Suzuki, UltraTech Cement, PVR and Zee Entertainment.

Barclays is optimistic on an earnings recovery in second half of current financial year. It adds that fiscal policy is beginning to turn supportive.

Barclays' top stocks picks: Axis Bank, Container Corp, Dr. Reddy's Labs, HDFC Bank, Maruti Suzuki, State Bank of India, Tata Motors, Titan and Ultratech Cement.