On a banner day for U.S. stocks Friday, most of the emerging markets complex was drowning in a sea red, extending the one-month slide for the iShares MSCI Emerging Markets Index Fund (NYSE: EEM) to 7.3 percent.

India ETFs were among the more egregious offenders Friday with the WisdomTree India Earnings ETF (NYSE: EPI) and the iShares India 50 ETF (NASDAQ: INDY) each losing more than one percent. Those two ETFs are off 8.6 and 7.8 percent, respectively, over the past month. That may imply a dire forecast ahead for Indian stocks, but ebbing inflation and an accommodating monetary policy from the Reserve Bank of India could help drive buyers into Indian equities later this year.

Indian companies could also surprise on the earnings front. Earnings for the 50 firms that comprise the CNX Nifty Index could jump 16 percent to 18 percent in the year to March 31, Bloomberg reported, citing Morgan Stanley India. Reliance Capital Asset Management sees profits for the 30-stock S&P BSE Sensex rising 12 percent to 15 percent, according to Bloomberg.

The potentially good news for Indian stocks and ETFs comes at a critical juncture. Plunging commodities should have proven to be a boon for Asia's third-largest economy, which must import the bulk of its energy needs. However, the rupee has not cooperated and has tumbled along with a plethora of other emerging market currencies. In the past month, the WisdomTree India Rupee Fund (NYSE: ICN) is down 5.3 percent.

Still, the news of accelerating earnings comes at a time when investors are under-allocated to the country. U.S.-listed India ETFs had just $2.63 billion in assets combined at the end of the first quarter with EPI controlling the bulk of that sum with over $1 billion in AUM.

Times may be changing for the better as investors, perhaps looking for bargains, poured nearly $4 billion into Indian stocks last month.

Indian stocks are also trading at significant discounts to the broader emerging markets universe. EPI had a P/E ratio of just over 10 and price-to-book ratio of 1.65 at the end of the first quarter, according to WisdomTree data. The comparable numbers on the MSCI Emerging Markets Index are nearly double in both cases.

At the sector level, declining input costs could bolster Indian consumer shares, which is significant for ETFs. INDY allocates a combined 17.25 percent of its weight to discretionary and staples names. Those sectors combine for just over 10 percent of EPI's weight, but that ETF does feature a 12.5 percent allocation to technology, useful at a time when that sector is showing strength.

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