Indian stock market will continue its bull-run next year with its benchmark index Sensex likely to touch the 24,000-mark by end of 2008 on strong performances of blue-chip companies, Australian banking major Macquarie said.

“We think that 2008 has the possibility of being, yet again, a great year for the Indian market. Our end-year index target is revised to 24,000,” it said in a report.

Bullish on domestic consumption, easing rates and capital spend, Macquarie has recommended investors to stick with these three themes.

Observing that India would be in a ‘sweet spot’ with domestic growth bolstered by capital flows even as the US slows without slipping into recession, Macquarie said these would help Indian companies to raise value in sister firms.

“As liquidity chases stocks in India, we see companies realise value in subsidiaries and ancillary businesses during the next year,” it said. Almost all sectors would have a play in this —insurance subsidiary of banks, tower arms of telecom firms and asset spin-offs from infrastructure companies.

Macquarie, however, did not feel that Indian stocks were ‘too expensive’. On the contrary, it observed that valuation of Indian stocks, compared to other regional markets, was respectable. “India is below historic peaks, despite interest rates being lower and GDP growth faster. Even compared to other regional markets, India’s valuations are respectable, despite the fast pace of growth and deep markets,” the report said.