"The overwhelming consensus is bullish on India and practically every investor we met is overweight on the domestic market," DSP Merrill Lynch India research analyst Jyotivardhan Jaipuria said in a note.

"There is practically no debate on our view that re-rating would drive markets to our year-end target of 27,000," he said.

Jaipuria added however that such consensus bullishness may be the biggest risk to markets.

The brokerage said it met nearly 60 global investors over the past two weeks, and all are overweight on the country.

Some investors agree that shortly they could see a slight pullback on global concerns and a possible monsoon failure, but most of them wish to buy on the dip.

Investors believe that the country's growth story clearly stands out among emerging markets. However, future foreign institution investor inflows may be driven by global funds which are not as heavily positioned in the country.

Jaipuria said: "While investors are overweight on the country, they are not fully positioned for an economic upturn. Investors have definitely moved partly towards domestic plays relatively due to their positioning in the beginning of the year. We believe that investors have generally added the higher quality stocks amongst cyclicals, but will continue to add to domestic plays."

He said the agency senses that there is still very low positioning in deep cyclicals like government banks and the infra scrips.

The earnings downgrade phase is behind us and the upgrade phase should start from mid-2015. "Our overweight sectors are auto, cement, banks, energy and industrials," he said.

PTI