Hong Kong-based financial company CLSA has made tremendous changes to its India stock portfolio for 2025. The company has included giants like Tata Motors, NTPC, Nestle and Britannia, while the country's largest private bank HDFC Bank has been removed from the list.

Big names like Reliance Industries, TCS, ICICI Bank, ITC, Axis Bank, and ONGC have also been included in CLSA's portfolio. At the same time, SBI Life, Hindalco, Jindal Steel and Power and IndusInd Bank also managed to make a place. CLSA has created a strong option for investors by including these big companies in its strategic portfolio.

What do CLSA experts say?

CLSA experts said, "We have focused on large stocks that have fallen more than 20%. Tata Motors, NTPC, Nestle and Britannia are now in a better position. By excluding HDFC Bank, we have further strengthened the portfolio."

What is the masterplan of CLSA?

CLSA says that the recent decline in the market has created new opportunities. More than 50% of the stocks of NSE 200 are trading 20% ​​below their 52-week high. CLSA has shortlisted some 'stocks' from this.

• Tata Motors: After a huge decline of 35%, the company is now in a better position. The challenges of JLR and commercial vehicle sector have now been overcome to a great extent.
• NTPC: The power generation company's decline has made it a great entry point. CLSA expects the power sector to shine in early 2025.
• Nestle and Britannia: The government's cheap consumption schemes will directly benefit FMCG giants like Nestle and Britannia.

Why was HDFC Bank removed?

CLSA has excluded HDFC Bank and reduced its focus on banks. The reason? Possible rate cuts expected from RBI may be seen, which may slow down the earnings of banks.

CLSA says that it is still overweight in commodity and insurance sectors. On the other hand, sectors like IT, discretionary, industrials and healthcare have been made underweight.

In 2025, India will have to strike a balance between global and domestic economic conditions. On one hand, there are new opportunities, and on the other hand, there are challenges which are giving investors time to think.

What is the game on the global front?

With the return of Donald Trump to the US, the game of trade sanctions is back in the news. If sanctions remain mild, investment may increase in countries like China, and India may be left behind. But if sanctions become stricter, India may benefit from it.

On the other hand, indications from the US Federal Reserve indicate that a major cut in interest rates is not expected in 2025. This means that the dollar will remain strong, which may cause difficulties for emerging markets, especially India.

India's domestic strategy

The picture within the country is looking a little better. Due to the new leadership in RBI and the possible decline in inflation rate, there is a possibility of reduction in interest rates. But due to the high valuation of Indian rupee and bonds in 2024, a big decline in bond yields is difficult.

Due to the welfare expenditure of the government, good monsoon and better sowing of crops, income is expected to increase in rural areas. This will directly benefit the market of cheap consumer products.

Will cheap consumption stocks become stars?

After the recent correction, large consumption stocks are now available at attractive valuations. Investment and capex stocks are still expensive in comparison. The government's capex expenditure has come down, which is leading to investment inclination towards consumption stocks like Nestle and Britannia.

The market performance in 2025 will depend a lot on global and domestic conditions. But cheap consumption stocks can prove to be a safe and profitable bet for investors.