BENGALURU, Oct 11 Reuters Brokerage CLSA has increased its exposure to Indian equities, citing prospects of strong economic growth, profitability and credit demand, and changed its portfolio allocation to a 20 overweight stance from 40 underweight earlier.

The brokerage, which had an underweight position on India between October 2022 and March 2023, noted that it persisted far too long with its negative view as it changed its stance.

Strong credit impulse the change in new credit measured in relation to GDP , favourable energy costs, robust corporate earnings growth, stable macroeconomic outlook and improving external balance dynamics will sustain the momentum in Indian equities into 2024, CLSA said.

The brokerage39;s change in stance on Indian equities comes amid an 8.75 rise in the bluechip Nifty 50 this year.

The more domesticallyfocussed small and midcaps have jumped 31 and 28, respectively, over the same period.

We use the funds raised from our October 3 China downgrade together with funds made available by our August 23 45 underweight stance on Australia to upgrade Indian equities, CLSA analysts Alexander Redman and Della Chen wrote in a note.

India39;s growth dynamics support a sustained 15 annual earnings per share expansion, CLSA added.

On Tuesday, the International Monetary Fund raised India39;s economic growth forecast for the current fiscal to 6.3 from 6.1 earlier, citing strongerthanexpected consumption.

CLSA expects India39;s purchase of 45 of…