The Indian indices have witnessed a massive recovery in the June 2020 quarter after hitting four-year lows in March. The benchmarks - Nifty and Sensex posting their best quarterly gains in 11 years in the June 2020 quarter. In June 2009 quarter the indices were up over 40 percent.

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However, for the year 2020 (YTD), the indices were still down around 15 percent on the back of the economic impact of coronavirus pandemic and the recent India-China border tensions.

The pandemic started in January and since then the Indian benchmarks have witnessed levels nearing the global financial crisis of 2008. Just in the January-March quarter, the indices declined around 30 percent due to this.

Meanwhile, in the broader markets, the midcap and smallcap indices rebounded to rise around 25 percent. In the previous quarter, the indices lost around 30 percent each.

Among stocks, M&M was the top gainer for this quarter, up nearly 80 percent followed by RIL, which rose over 50 percent. Bajaj Auto, Maruti, IndusInd Bank and Sun Pharma also jumped over 30 percent each in the June quarter.

While IIFL advises caution despite the optimism in the markets, highlighted that from an investor's perspective it is likely that there will be a renewed interest given that highly leveraged companies have underperformed significantly. Another factor that the shareholders will focus on are strong balance sheets, Barclay's added.

Meanwhile, for the investors, SMC Global suggests, "there are many companies that have been least impacted by the outbreak of coronavirus and their prospect looks promising ahead with the improvement in the economy. Hence, we have picked up quality stocks from which investors can earn a huge return. A buy on dip strategy but in a staggered manner may be suggested for investors."

Barclays also believes that quality stocks especially technology and healthcare should be the winners. The report also points out that business models that address sustainability trends, such as moves to a low-carbon economy and artificial intelligence should stand to do well in the long run.

In volatile times like these, the global research house feels that it is vital to stick with quality and diversify a portfolio because the chances of aggregate equity valuations to be capped post-COVID-19 is higher.