Goldman Sachs in its latest note on Indian stock market said investors with a medium-term horizon, who can weather the near-term uncertainty, can consider stocks where foreign ownership and positioning is light, that are trading at reasonable multiples and could likely outperform when foreign sentiment improves. The foreign brokerage suggested 12 such stocks, saying it maintained its positive view on financials and staples on a tactical basis, as they have low earnings sensitivity to oil shocks, and trade at historically low valuations. The list included Hindustan Unilever Ltd, Larsen & Toubro Ltd, Bajaj Auto Ltd, Bank of Baroda Ltd, Trent Ltd and Solar Industries Ltd. Others included Siemens Ltd, Bajaj Holdings & Investment, Bosch Ltd, Swiggy Ltd, One 97 Communications Ltd (Paytm) and MRF. 

Goldman Sachs picked these stocks from its coverage, within the BSE200 universe. It excluded its sell-rated stocks from the screen. Among these stocks, Swiggy and Trent are down 31-39 per cent from their 52-week high levels. Bajaj Holdings, BoB, RMF and Paytm are some other stocks that are down at 12-27 per cent from their 52-week highs. 
Goldman Sachs said while bulk of foreign selling is likely behind us, foreign re-buying may still be impeded in the near term, for a few reasons. It said empirical evidence suggests FII flows do not immediately return when oil prices fall. 

"Foreign capital did not return to Indian equities in the early-April oil correction, despite the significant sell-off during the preceding oil rally in March. Past evidence shows that foreign flows tend to be modestly positively correlated with falling oil prices in the short-term," it said.

Besides, it believes earnings revisions have become an increasingly important variable guiding foreign flows in Indian equities. 

"While much of foreign selling may have already occurred in anticipation of the forthcoming downgrade cycle, low visibilty around a recovery will likely impede foreign re-buying in the near-term," it said.
Lastly, compared to North Asian markets, India offers a less attractive risk/reward as it trades at significantly higher growth-adjusted valuations, on top of the ongoing investor concerns over the potential adverse impact of AI, Goldman Sachs said.

That said Goldman Sachs said bulk of foreign selling is likely over, after record outflows over the recent months.