New Delhi, February 25 (IANS). There are early signs of recovery in the Indian stock market and in the base case scenario, Nifty may touch the level of 27,958 in the next 12 months. This information was given in a report released on Wednesday.
The PL Capital report said that the bullish scenario of 20 times forward earnings multiple indicates the Nifty touching 30,497, while the bearish scenario sees the Nifty at the level of 26,486.
Base case scenario means normal situation in the market, bullish scenario means bullish trend and bearish scenario means weak trend.
The company said earnings per share (EPS) are expected to grow by 3.8 per cent and the earnings trend remains strong in the medium term with an estimated CAGR of 16.3 per cent during FY 2026-28.
The report further said that the companies’ performance remains strong, with sales, EBITDA and profit after tax growing by 9.9 per cent, 16.4 per cent and 16.7 per cent year-on-year, respectively.
“India’s growth story is entering a pivotal phase driven by policy clarity, landmark trade agreements and continued infrastructure development, laying the foundation for the next phase of expansion,” the report said.
It further said that the long-running consolidation phase in the market now appears to be opening the door to renewed optimism and that despite changes in the recent earnings analysis, structural factors remain firmly in place.
“India is moving from a cyclical recovery phase to a structurally sound growth path,” said Amnish Agarwal, director of institutional equity research at PL Capital.
Aggarwal further said, “As capital formation accelerates and productivity improves, we believe the Indian stock market is entering the initial phase of multi-year compound growth.”
India-EU Free Trade Agreement The report said the rapid progress made in India’s trade diplomacy has been a decisive catalyst for the next growth cycle.
Labour-intensive sectors like textiles and apparel, marine products, leather and footwear, gems and jewellery, chemicals, machinery and electrical equipment are likely to benefit significantly.
The firm said demand for marine exports, leather products and gems – which are important sources of employment generation – is expected to increase significantly.
The firm further said that capital goods and engineering companies can benefit from the boom in infrastructure and defense sectors.
–IANS
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