Sensex and Nifty could reclaim record highs by Diwali 2027, say analysts
Market experts suggest resilient corporate earnings and improved valuations may drive a recovery in Indian equity markets during Samvat 2083.
Analysts believe the Sensex and Nifty could reach their previous record levels or achieve new peaks by Diwali 2027, according to a report by The Economic Times. This optimism follows a period of volatility and underperformance where the Nifty and Sensex declined by over 8 per cent over the last year.
The Nifty currently stands at 23,810, which is about 10 per cent below its record high of 26,373. Meanwhile, the Sensex is at 76,917, approximately 11 per cent lower than its peak of 86,159.
Rupen Rajguru, Head of Equity Investments and Strategy at Julius Baer India, said he expects Indian equities to provide better returns in the coming Samvat after two years of quiet performance. He noted that the Nifty is trading at roughly 17 times its 12-month forward earnings, which is one standard deviation below its long-term average.
Vipul Bhowar, Executive Director and Head of Equities at Waterfield Advisors, said the market is moving from a liquidity-driven phase to one led by earnings. He noted that while second-quarter earnings in some mid-cap and small-cap segments were strong, future gains will depend on company-specific performance and profit margins.
Mayur Shah, PMS Fund Manager at Anand Rathi Advisors, said nearly two years of consolidation have made valuations more reasonable for long-term investors. He suggested a faster rebound could occur if geopolitical tensions decrease and global energy supplies stabilise.
Analysts warned that external risks such as global inflation, interest rate policies from the US Federal Reserve and the Reserve Bank of India, and high crude oil prices could influence investor sentiment.