Brokerage house HSBC India has upgraded its rating on the Indian market to ‘neutral’ from ‘underweight’, saying valuation premium to Asia has declined and is now approaching a 10-year average premium. “The hype is almost gone,” says the HSBC note, adding, “High-frequency indicators suggests the earnings environment might improve, although earnings expectations remain too optimistic.” In sectoral ratings, HSBC has upgraded IT to overweight citing realistic earnings expectations and reasonable valuations and upgraded industrials (capital goods, engineering) to neutral, citing signs of recovery. It has downgrades healthcare to neutral on high earnings expectations and rich valuations, is overweight on FMCG and utilities, and underweight on financials. The stocks in HSBC’s buy list include Yes Bank , Emami , HPCL , L&T , Asian Paints , Hindustan Unilever , Aurobindo Pharma and Infosys . HSBC is bearish on Bharti Infratel, Container Corporation, M&M Financial, Sobha Developers, Marico, Bank of India and Steel Authority.