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The raging war in the oil-rich Middle East has rattled stock markets across the globe, with Dalal Street being no exception. After crashing more than 11% in March, Elara Securities said that historical patterns suggest limited downside for the benchmark index Nifty.The domestic brokerage cited data from the timeframes of seven major geopolitical conflicts in the past 25 years - Iraq war (2003), the Lebanon war (2006), the Libyan Civil War (2011), Russia–Ukraine (2022), Israel–Hamas war (2023), Iran–Israel conflict (2025), and the ongoing US–Iran escalation. It said that Nifty’s drawdown during the onset of conflicts has usually been capped at approximately 10%. Hence, historical patterns suggest limited downside for the benchmark index now, after the 11% crash in March.“Importantly, once early signs of normalisation emerge, markets tend to recover swiftly,” Elara said. However, it noted that the key exception to this historical pattern was in calendar years 2011-2014 when Brent sustained above $100 per barrel, leading to a prolonged sideways market without meaningful highs. The eventual decline in oil prices acted as the trigger for a strong Nifty upcycle, it added.Also read: Sammaan Capital becomes IHC Group co, receives Rs 5,652 cr in first tranche of stake saleNifty's valuation below the long-term trend signals a potential reboundElara assessed the one-year forward P/E relative to its rolling 10-year average and concluded the Nifty is trading 7% below its 10-year average, placing it in a historical “bounce zone”. “Outside of extreme disruptions like COVID-19, this level usually acted as a floor for valuation. Even during the Russia–Ukraine conflict, despite Brent sustaining above USD 100/bbl, Nifty multiples bounced back from 10-year rolling averages,” it said.“The recent TACO and Iran allowing 'nonhostile ships' to transit the Strait of Hormuz, along with crude oil prices dropping below USD 100/bbl, have reduced immediate energy supply risks. With our base case assuming gradual de-escalation, the current valuation provides a favourable entry point, with limited downside. We pick 20 value plays which offer a good risk-reward opportunity with healthy fundamentals in the current scenario of extreme correction,” the brokerage added.Elara's top picsAuto and power remain Elara’s preferred bets, which added that large-cap auto stocks like Maruti Suzuki and Royal Enfield-maker Eicher Motors have corrected sharply since the onset of the US-Iran conflict. While near-term concerns persist around input cost pressures from elevated commodity prices and potential demand moderation in the event of a prolonged conflict triggering an inflation shock for consumers, underlying retail data remains robust and encouraging, it further said.The domestic brokerage added that Vahan retail registrations so far show strong double-digit growth, and this momentum is expected to receive further tailwinds from the Eighth Pay Commission awards, slated for announcement early next year.Within the power sector, 18 out of the 19 utility stocks under the brokerage’s coverage have outperformed the Nifty 50 in current drawdown, which the firm said underscores the sector’s relative resilience. “The escalating conflict is expected to accelerate India’s electrification cycle, while surging data centre capex is driving incremental power demand. This positive backdrop is further supported by the likely passage of the New Electricity Amendment Bill, which will unlock structural reforms in the sector. Consequently, power generation, transmission, distribution, and data centre-linked plays are emerging not merely as defensive anchors but as clear structural beneficiaries in the medium to long term. NTPC, NLC India, and ACME Solar remain our highest conviction picks within the space,” it added.Also read: FY26 IPO market a disaster as investors lose money in 2 out of 3 issues. Will next year be better?Where is the value currently?In its report, Elara listed out several stocks emerging with better risk-reward dynamics where fundamentals remain intact, and valuation is either trading below the five-year median, and in some cases even below the Russia–Ukraine crisis lows.These include HDFC Bank, Maruti Suzuki, Eicher Motors, Infosys, LTI Mindtree, L&T, Godrej Properties, NTPC, NLC India, ACME Solar and Eternal.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

The government on Monday said 10 foreign-flagged ships carrying energy cargo for India are stranded in the Persian Gulf, even as 18 Indian vessels remain in the same region. The situation has raised concerns over the movement of supplies through the Strait of Hormuz. Rajesh Sinha, special secretary in the shipping ministry, told TOI's Dipak K Dash that three of the stranded foreign ships are carrying LPG, four have crude oil, and three are loaded with LNG. He said the government’s priority is to ensure that Indian-flagged vessels carrying India-bound cargo are allowed to pass through the Strait of Hormuz.Also Read| India diesel exports to SE Asia hit 7-year high in March due to Iran war, data shows Two LPG carriers with about 94,000 tonnes of cooking gas cleared the Strait of Hormuz on Saturday. These ships are expected to dock at Mumbai Port and New Mangalore Port within the next two days. On whether empty vessels will be sent back to the Persian Gulf for fresh loading, Sinha said, “We are yet to reach the stage where we start sending them (Indian-flagged vessels) back.” He also pointed to a rise in insurance costs. “The affected area is not just the Strait of Hormuz; areas outside of it also fall under the high-risk area (HRA).” He said commercial premiums earlier stood at 0.04% of the insured value before the war, but have now increased. In one case, the premium has reached 0.7% of the insured value, and it could rise further.At least four Indian-flagged tankers have crossed the Strait of Hormuz since the war began, based on official updates and reported movements. Two LPG tankers crossed the strait in mid-March, marking the first confirmed passage after tensions disrupted shipping routes in the region. Later, around March 29, two more LPG carriers completed the transit as authorities allowed limited movement on a case-by-case basis.