Foreign investors have once again lowered their outlook for Indian equities, according to a Reuters poll, as funds look for better value in other markets across Asia.

The survey findings come as global investors diversify their Asian allocations. While optimism around artificial intelligence has lifted technology-heavy markets in the region, such as Taiwan and South Korea, whose benchmarks are heavily weighted toward semiconductor and AI-linked hardware makers, the poll indicated that investors have also identified attractive value in Thailand, Malaysia, and the Philippines — markets that had lagged the broader regional rally.

The Reuters poll, conducted among market analysts and economists, points to a repeat downgrade of India's equity forecast, reflecting the continued rotation of foreign capital toward other Asian destinations. India had been a standout destination for foreign portfolio inflows in recent years, but analysts have noted that Indian benchmarks trade at higher valuation multiples than many regional peers, a factor that becomes more consequential when global funds weigh relative returns across emerging Asia. Foreign portfolio investors have alternated between outflows and modest inflows in Indian equities in recent months, and successive downgrade of forecasts in analyst surveys signals sustained caution on the pace of gains from here.

What bears watching is whether subsequent rounds of analyst surveys confirm the trend, and how foreign positioning across Southeast Asian and AI-linked North Asian markets evolves relative to India in the coming quarters.

Source: CNNBC-TV18