** India Strategy & Outlook** **Source:** Morgan Stanley (Jonathan Garner) **Core Thesis** India is positioned to enter a cyclical earnings upswing, with projections indicating potential outperformance relative to Emerging Market (EM) peers over the next two years. **Key Drivers & Catalysts** * **Macro Tailwinds:** Growth momentum is expected to be sustained by policy easing, a revival in capital expenditure (capex), and robust earnings trajectories. * **Sentiment Shift:** These structural drivers are anticipated to trigger a reversal in investor sentiment, offsetting current headwinds regarding elevated valuations and Foreign Institutional Investor (FII) outflows. **Sector Implications** Primary beneficiaries of the projected upswing include: * **Financials** * **Industrials** * **Consumption**