Indian markets have been volatile as the Adani crisis continues to dominate headlines, but analysts say this could be a buying opportunity.

In particular, some are bullish about the construction sector and say an infrastructure push could benefit cement stocks.

In a January note, Bernstein analysts led by Venugopal Garre, said they were “generally optimistic about the real estate cycle and the potential for a better rural environment.”

Investors can consider playing the country’s infrastructure sector through domestic cement names, Garre said. 

Bernstein likes UltraTech Cement — a company Garre said has the capacity to keep up with the growing number of real estate projects coming up in India. 

He said “70% of cement demand comes from real estate, and 30% comes from infrastructure,” and added that when a new property is built, cement is needed from the first day the project cycle commences. 

This is unlike electric equipment or circuitry that is only needed in the third or fourth year of the construction project, he explained. 

Sanjiv Bhasin, director at IIFL Securities, also said UltraTech Cement is one of the firm’s “top picks,” along with Ambuja Cements.

Shares of UltraTech Cement was trading at about 7,123.05 on Wednesday, lower by 0.21%. The stock is close to its 52-week intraday high, according to FactSet.

The government’s spending on infrastructure is increasing and “we think cement prices are headed higher because we [are going] into a season where construction activity may be at the highest,” Bhasin said. 

FactSet data showed shares of Ambuja Cements have fallen 34% year-to-date. Bhasin has said the stock is a buy and that it’s a “brilliant opportunity” despite the current market volatility.

The Adani Group owns a 63.15% stake in Ambuja Cements, Refinitiv showed.

The price for Ambuja Cements is falling “because it exists within the Adani umbrella,” said Praveen Jagwani, chief executive officer at UTI International Singapore.

“This temporary fiasco is only a buying opportunity … We still think that UltraTech and Ambuja are very, very good plays on the cement side,” Bhasin said, adding than an impetus on infrastructure spending will cause these names to outperform in the next quarter.

Morgan Stanley is bullish on India’s industrials sector, its analysts said in a note on Feb. 1 after the budget announcement.

“As the Budget supports capex and employment creation, we remain constructive on the domestic demand strength,” the financial services firm said.

Finance Minister Nirmala Sitharaman announced during the annual budget last week that the country will increase infrastructure spending by 33% to 10 trillion rupees ($122.29 billion) in the next fiscal year. India’s fiscal year starts in April and ends in March the next year.

India’s construction materials industry should see some upside from the rise in capital expenditure, but investors have to be “very careful” when picking cement stocks, Jagwani told CNBC.

India needs more high quality commercial buildings, roads and airports, but the country’s infrastructure sector is also “super unpredictable and risky,” Jagwani warned.

Return on investment would fall each year as infrastructure projects get delayed, Jagwani pointed out, claiming that it happens frequently in India. 

Engineering companies that focus on infrastructure and construction are also good buys, IIFL Securities said.

They include ABB India, Siemens India, and Larsen & Turbo.

Larsen & Turbo will be coming out with “higher double digit margins, and their order flows are the strongest,” Bhasin said. 

UTI International also likes Berger Paints, which Jagwani said has the “ingredients” to see a continuous growth in sales and will benefit not just from new buildings being built, but older ones that need maintenance. 

“Paint is in the replacement market. People need to get their houses and apartments painted every few years because of rain and excessive heat,” he said. 

The shares, however, are down 4.5% year-to-date and close to their 52-week intraday low of 527.6 rupees. Berger Paints was trading at about 555.45 rupees on Wednesday. 

— CNBC’s Michael Bloom contributed to this report.