JPMorgan sees positive returns for Indian equities, but expects North Asia to outperform

Rajiv Batra, Head of Asia & Co-Head of Global Emerging Markets Equity Strategy at JPMorgan, expects Indian equities to generate positive returns over the next 12 months but believes North Asia will continue to outperform, supported by stronger earnings growth from artificial intelligence (AI) and semiconductor investments.

He expects India's earnings growth at 10-11%, broadly in line with current consensus estimates, and said stable oil prices, commodity costs and monetary policy could support 15-16% earnings growth in the financial year 2027-28 (FY28), creating the potential for high-teen market returns over the next 12 months.

Batra said selling pressure in India may be easing as overseas ownership has fallen from around 18-19% to nearly 14.5% and is now increasing in midcap and smallcap stocks.

He views the recent correction in technology stocks across Korea and Taiwan as an opportunity rather than a change in the long-term trend. The selloff, he said, was led by derating and not by earnings downgrades but upcoming guidance from hyperscalers on AI capital expenditure will determine whether spending remains on track, with estimates of $870 billion in 2026 and more than $1 trillion in 2027.

JPMorgan continues to be overweight Korea, Taiwan and China, while maintaining a neutral and selective stance on India and ASEAN markets. He cited stronger AI-driven earnings visibility in North Asia, while warning that South Asian economies could face headwinds from higher US interest rates, a stronger dollar and a possible El Niño impact later this year.

For the full interview, watch the accompanying video

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