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Want to invest in India? Here's where to look

There's skepticism among some observers over whether the Indian stock market can continue to rally after a nearly 30 percent gain so far in 2014.

Not to worry, there's still plenty of opportunity in the world's largest democracy say some analysts who specialize in the country, and a few sectors show particular promise.

India's Prime Minister Narendra Modi comes out of a meeting room to receive his Bhutanese counterpart, Tshering Tobgay, before the start of their bilateral meeting in New Delhi.
Adnan Abidi | Reuters
India's Prime Minister Narendra Modi comes out of a meeting room to receive his Bhutanese counterpart, Tshering Tobgay, before the start of their bilateral meeting in New Delhi.

One area is so-called soft infrastructure sectors like training and education, said Parag Saxena, CEO of New Silk Route Partners, a $1.4 billion Indian-focused growth fund.

"In India, it's still a challenge for corporations to find high-skilled workers. Companies that are focused on providing the training needed to meet the requirements of a job—whether it be from working as a barista to CEO—will do well," Saxena said.

Another growth area: power. Swami Venkataraman, senior credit officer in the project and infrastructure finance group at Moody's Investors Service, said power and coal will likely do well, as newly elected Prime Minister Narendra Modi has made power efficiency a top priority.

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Modi has already abolished inefficient organizations created by Congress that did not help in alleviating India's power problem and angered millions of Indians. (One-third of India's power is currently stolen, said Venkataraman.)

Other money managers see India's young population as a significant driver of the country's economy going forward.

The fact that 54 percent of the country's population is under 24 is a "setup for great investment," said Robert Lutts, president of Cabot Wealth Management, which manages money for high net worth clients.

One obstacle to growth is the government, which has hindered the movement of capital and investment in India, said Lutts. There is hope that the new prime minister will change that.

"Modi has the opportunity to instigate change in a country that is hungry for growth," said Lutts.

When evaluating India and broader emerging markets, "look at where there are difficulties and invest in the solution," said Lutts.

Read MoreIs India 'holding a gun to its own head'?

The analysts were speaking at an event last week hosted by the New York Society of Security Analysts' Global Investing Committee.

—By CNBC's Seema Mody

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