A latest Morgan Stanley report has warned that macro headwinds pose a risk to India’s growth and Ridham Desai, the head of India equity research and strategist at the financial services company, has gone for an anagram to explain this further, maybe inspired by SS Rajamouli’s blockbuster RRR.

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The economist, who spoke to CNBC-TV18 from the sidelines of the Morgan Stanley Annual India Summit, has added an extra 'R' to 'RRR' that he calls are key factors that will keep the Indian markets rangebound at the current levels.

“There are quite a few challenges out there. I call it a bunch of 'R's... nothing to do with my name, but we have Russia

, prospects or the possibility of the recession in the US, we have rates going up in India, we have revisions in earnings,” Desai said.

Since the start of the year, the Nifty has fallen 7.1 percent year-to-date as shown in the chart above and the Sensex has tumbled from the highs of 61,309 to as low as 52,792.

So are things all bleak? Desai doesn’t think so and said he still characterises it as a bull market.

“This is kind of a deep correction in a multi-year bull market. It's something similar to 2004 when the Fed inflected its rate cycle. And, if I remember correctly, the Sensex was down about 30 percent from peak to trough in that year between May and August before it bottomed out. It was a very swift, painful correction and then we came out of that and the bull market resumed,” he explained.

Morgan Stanley is still overweight sectorally on the likes of technology and consumer discretionary. Among stocks, they are bullish on oil and gas stocks and pen them as their key picks. In fact, in that space, they are only negative on Petronet LNG and GSPL.

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Desai also believes that industrial stocks will have a chance to grow.

“Industrial stocks have become so tiny in terms of the market cap because they have not had any business for the last 10-12-13 years. They don't even feature in our coverage universe. But they could actually go up quite a lot and some of these may become multi-baggers in three or four years,” he said.

Morgan Stanely views small stocks as better investment options than large caps for the short term.

“We turned cautious on the broad market in October and a lot of pain is behind us. So, on a relative basis, we were arguing that large-cap will beat small caps. I think that cohort switch time has come because a lot of damage has happened in the broad market. So, this is a relative thing, not an absolute one. We may still get absolute downside before we are done with it,” said Desai.

(Edited by : Amrita Das)