The surprising reason India's most expensive stocks often keep rising

Jefferies' analysis of 15 years of Indian market data shows that at least 8 investment themes, including defence, retail, NBFCs, hospitals and cap goods, traded 28% to 78% above their 10-year average valuations yet delivered 40 to 290 percentage points of outperformance over the Nifty50 in the following 2-3 years. The brokerage now flags private power companies as the next likely theme, with power utilities trading 46% and power equipment stocks 65% above their 10-year average PE as of June 2026. Top picks named are JSW Energy, Adani Energy Solutions, Premier Energies and Siemens Energy, supported by El Nino-led demand surge and a hard asset thematic.