Indian equities were clearly an outperformer compared to most global peers in CY23, more in mid and large-cap space. Interestingly, this
was amidst geopolitical tensions, a rise in key policy rates across the globe and volatile commodity prices.
The domestic economy, nonetheless, was resilient all across this time frame with a revival in the private capex cycle, robust infrastructure spending by the government,
record GST collection & most importantly margin expansion led to healthy high double-digit corporate earnings growth.
Nifty fair value pegged at 25000
Corporate earnings recovery has been healthy in the recent past
with Nifty earnings growing at 22% CAGR over FY20-23. Going
forward, introducing FY26E, we expect Nifty earnings to grow at a
CAGR of 16.3% over FY23-26E.
Our Dec 2024 target for Nifty is set at 25,000 wherein we have
valued Nifty at 20x PE on FY26E EPS of ₹1,250/share with
corresponding Sensex target set as 83,250; offering a potential
upside of ~15% from current index levels
Why we remain Bullish?
Indian Indices made fresh life highs and retained its the best performing market helped by resumption of foreign
flows. The net flows for the current calendar year is nearly of $21 billion while rest of the emerging markets have
seen nominal flows. In the post covid era, while most of the markets are still reeling below their 2021 highs,
Indian indices have given significantly higher returns than the rest.
What India will be… in next 8-10 years!
Sectors : Theme for the next Decade
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