Automobile, cement, consumer staple, oil and gas, and telecom sectors will be the direct beneficiaries of lower prices, the foreign brokerage has said in its India strategy report.
Prices are at five-year low levels on concerns on global growth and a decision by the Organization of Petroleum Exporting Countries (Opec) not to slash production.
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Brent crude prices have come off nearly 40 per cent since June, when these were at $115 a barrel. Currently, these are trading below $70 a barrel.
The slump in prices may signal the pain the global economy is going through but it could be a blessing for the Indian market.
According to Barclays, in nine of 11 instances when prices have declined over 10 per cent, the Indian market has outperformed the region's benchmark index, MSCI Asia ex-Japan index.
"Crude imports account for nearly a third of all merchandise imports for India, and as such, a significant decline in prices is beneficial to India's current account deficit," said Bhuvnesh Singh, managing director and head - India research, Barclays, in the report.
"The crude price decline also lowers inflation directly and indirectly through second-order benefits to logistics costs, etc. Further, with the fuel subsidy accounting for a quarter of India's fiscal subsidies, a decline should also help the fiscal deficit," he said.