India's large caps stuck in 'bygone economic era', says Bernstein, as foreign investors head for the exit

Global brokerage Bernstein on Monday said foreign investors had little reason to invest in the world's fastest-growing major economy, pinning the blame for their ongoing exodus on India's large corporates struggling to reinvent their businesses in the face of disruption from new technologies.

"Many of India's large caps represent a bygone economic era," Bernstein said in a report, adding that these businesses do not offer "high growth" rates that can justify the "sky-high valuations" of Indian markets.

"Most [large corporates] are not investing in the future, but consolidating their past, often expecting policy to continue shielding them from global competition," the report said. Large corporates with the "deepest pockets" are reluctant to provide the capital India needs to develop scale in emerging technologies like electric vehicles and semiconductors, it said.