BENGALURU (Reuters) - India's benchmark Nifty 50 stock index will rise a further 7% over the rest of this year, irrespective of the outcome of the country's ongoing national elections, the chief investment officer of Emkay Investment Managers said on Tuesday.

The index has risen 5.3% to around 22,900 points so far this year and Emkay expects the index to finish the year at roughly 24,500, said Manish Sonthalia.

That is slightly higher than equity analysts' 2024-end target of 23,850 points, according to a Reuters poll conducted earlier this month, as retail investors plough money into one of the world's most expensive stock markets.

The past couple of weeks, however, have seen a surge in trading volatility on doubts over the outcome of India's six-week-long national elections that ends next week.

Opinion polls ahead of the elections had predicted the ruling Bharatiya Janata Party and its allies could win three-fourths of parliament's 543 seats but expectations have since moderated.

Emkay's base case is for the BJP and its allies to win 320 seats, give or take 20. A stronger victory could lead to a "euphoric" reaction but investors should not cash out, Sonthalia cautioned.

If the BJP win fewer than 280 seats, it will be a negative surprise for the markets, he said.

"However, it will be a golden opportunity to buy quality large- and mid-cap names as valuations would turn very attractive for medium- to long-term investors."

Contrary to the general opinion, Sonthalia thinks the Nifty 50's valuations -- as measured by comparing stock prices to one-year forward earnings (PE) -- are not very costly.

He expects the Nifty 50's PE to rise to 25 times, from 20 times currently.

Among sectors, Sonthalia is bullish on banking and financial services, power producers and financiers, defence and large oil marketing companies on account of earnings momentum and enhanced interest and investments in these sectors.

Consumer staples in mass-end is a bit risky, he said, because of uncertainty about the recovery in rural demand. ($1 = 83.1582 Indian rupees)

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Savio D'Souza)

By Bharath Rajeswaran