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Informist, Wednesday, Dec. 10, 2025

 

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--Kotak Securities: Nifty 50 seen at 29120 points by December 2026
--CONTEXT: Kotak Securities details market outlook for 2026
--Kotak Securities: Nifty 50 cos' profits seen up 17.6% in FY27, 14.8% FY28
--Kotak Securities: Preferred sectors for 2026 include BFSI, IT, healthcare
--Kotak Securities: See bull-case for Nifty 50 at 32032 pts in 2026
--Kotak Securities: See bear-case for Nifty 50 at 26208 pts in 2026
--Kotak Securities: Long-term trend of domestic equities strong, bullish
--Kotak Securities: Expect FII flows to turn positive sometime next year
--Kotak Sec: Govt, pvt capex didn't revive as expected but picking up speed
--Kotak Securities:Current 50% US tariffs expected to impact foreign inflows
--Kotak Securities:Geopolitical headwinds, weak rupee among risks for stocks
--Kotak Securities:Risks for equities include unresolved tariffs, FPI sales
--Kotak Securities: Saw sharp surge in IPOs, QIPs in last two years
--Kotak Sec: Barring small-cap indices, others performed better so far 2025
--Kotak Sec: Nifty 50 trading at 20.5 times FY27 price-to-earnings
--Kotak Securities: There is no AI buzz affecting Indian valuations
--Kotak Securities: Valuations of IT stocks at comfortable levels

 

MUMBAI – After a year of muted performance by the domestic equity market, Kotak Securities is bullish on the long-term picture as growth prospects have become stronger. The broking firm expects the benchmark Nifty 50 index to reach 29120 points by the end of 2026 in a base-case scenario. This would be up 13% from Wednesday's closing level of 25758 points, and better than the 9% rise so far in 2025 as well as in 2024. The Nifty 50 is currently trading at 20.5 times price-to-earnings of the financial year 2026-27 (Apr-Mar), which is close to its long-period average.

 

In 2026, the 50-stock index is likely to be near the 32032 level in a bull-case scenario and at 26208 points in case of a bearish environment, the broking firm said while detailing its market outlook for the year. Among its preferred sectors for 2026 are banking, financial services, and insurance, information technology, health care, and hospitality.

 

Kotak Securities said valuations of IT stocks are at comfortable levels and the buzz around artificial intelligence is not affecting valuations. Recently, the bubble in US AI-related stocks had a ripple effect on their Indian peers. However, the broking firm remains optimistic about IT services companies and their growth prospects. So far in 2025, most indices, barring the small-cap indices, have performed better, it said.

 

The Mumbai-based brokerage expects the aggregate net profit of Nifty 50 companies to grow 17.6% in FY27 and 14.8% in FY28. If so, this would follow more than a year of muted and lower-than-expected earnings performance. There has also been a sharp rise in new players entering the primary equity market as well as companies raising funds through qualified institutional placements in the past two years, it said.

 

RISKS

While the outlook for the domestic stock market is bullish, the brokerage listed some risks that could cap its gains. These include the unresolved tariff tangle with the US, geopolitical headwinds, the depreciation of the rupee, and persistent selling by foreign investors. Last week, the rupee fell below 90 to a dollar for the first time, down from around 85 a dollar at the end of 2024.

 

The brokerage also said the current 50% US tariff on Indian goods exports is likely to hit foreign inflows. While foreign investors are expected to turn buyers "sometime next year", Kotak Securities does not see them placing aggressive bets on Indian equities anytime soon. Capital expenditure by the government as well as by private players has not revived as much as expected but is picking up momentum, it said.

 

So far in 2025, foreign portfolio investors have net offloaded shares worth around $17 billion, almost 23 times the $755-million worth of equities they net sold in 2024. Now, all eyes will be on the US Federal Reserve's monetary policy outcome, due 0030 IST Thursday, developments in global markets, and the progress in negotiations on the India-US trade deal.  End

 

US$1 = INR 89.96

 

Reported by Anjana Therese Antony and J. Navya Sruthi

Edited by Rajeev Pai

 

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