China's economic growth has trumped India's for a while now, but the mainland's stock market is likely to continue playing second fiddle to the subcontinent, analysts said.
"While you do have strong GDP (gross domestic product) growth (in China), the key is you cannot buy GDP growth," Conrad Saldanha, manager of an emerging market equity fund at Neuberger Berman, told CNBC. "If you buy returns, you turn toward India."
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That's a view that's certainly paid off. India's benchmark Sensex index is up more than 30 percent since the beginning of 2010, and it's trading around record highs after rising around 8 percent so far this year. It's a sharp contrast with the Shanghai Composite's around 37 percent swan dive since the start of 2010, with the index down around 1.6 percent so far this year.
"Indian companies have done a great job in terms of returns, which has overshadowed the strong growth that has come through from China," Saldanha said.
China's economy grew an annual 7.4 percent in the first quarter of this year, slowing from a 7.7 percent increase in the last quarter of 2013, outpacing India, which has seen its economic growth stuck below 5 percent for the seven quarters through the end of 2013.
It's a far cry from the days of over 9 percent, which India, Asia's third-largest economy, enjoyed in the three fiscal years prior to the global financial crisis.
Some analysts don't expect growth will pick up anytime soon.
"The on-going weakness in industrial production and exports is best described as depressing," Credit Suisse said in a note last week, adding it expected GDP growth to remain in a 4-5 percent rage. "It looks more and more likely that this is indeed the 'new normal' for the country."
India's policy makers have battled with a difficult combination of high inflation, falling growth and ongoing political uncertainty and corruption issues.
"If you look at trading patterns, if you look at just the sheer investment opportunities, as you go down into the small-to-mid cap area of emerging markets, India stands out very prominently, in that respect, with a lot of entrepreneurial companies, despite, if you will, the lack of governance from the politicians the bureaucrats and the bottlenecks from an infrastructural standpoint," Saldanha said.
Investors are certainly voting that way with their funds. So far this year, foreign investors have sent around $5.44 billion winging into Indian mutual funds, compared with $6.18 billion pulled out of China funds and $1.40 billion exiting Hong Kong funds, according to data from Jefferies.
Fund managers have also made an about face on India's shares, with around 44 percent taking an overweight position on the market in April, compared with a net 13 percent taking an underweight position in March, a survey of fund managers from the Bank of America-Merrill Lynch found.
Others also see a clear advantage to India's investment proposition.
"India has far more proper companies than does China," said Hugh Young, global head of equities at Aberdeen Asset Management. "The proportion of clean relatively simple, professional companies is a lot higher in India than in China, which is dominated by state-owned companies."
Aberdeen is substantially underweight "pure" China mainland companies compared with the benchmark, while it is overweight on India, he said.
While Young believes some of India's recent stock market gains may be due to enthusiasm over its ongoing election and hopes for a new government, "the companies will continue to be better," he said.
—By CNBC.Com's Leslie Shaffer; Follow her on Twitter @LeslieShaffer1