New Delhi [India], July 17 (ANI): Indian equity markets may witness a strong upward move in the coming months, with the Nifty 50 index expected to touch a new all-time high of 28,957 by December 2025 if a bull run returns, according to a report released by PL Capital.
The Nifty 50 index had previously hit an all-time high of 26,277.35 in September 2024. The report has laid out three scenarios revising its earlier targets for the Nifty 50, depending on market conditions.
In the base case, the Nifty is valued at a 2.5 per cent discount to its 15-year average price-to-earnings (PE) ratio of 18.5x, with a projected March 2027 earnings per share (EPS) of Rs 1,451.5. This leads to a 12-month target of 26,889, revised upwards from the earlier estimate of 25,521.
In the bull case, the index is valued at a PE of 20x, resulting in a target of 28,957, revised from the earlier estimate of 27,590.
In the bear case, Nifty may trade at a 10 per cent discount to its long-period average, with a lower target of 24,821, slightly down from 24,831 earlier.
The report said, “We value NIFTY at PE of 20x and arrive at bull case target of 28957 (27590 earlier)”.
However, it emphasised that a revival in consumption demand will be critical going forward. Factors supporting this include a normal monsoon, multi-year low food inflation, interest rate and CRR cuts, and tax benefits from the FY26 Union Budget.
The report also stated that the first quarter of FY26 has shown a mixed trend, with demand remaining stable but no major acceleration. The upcoming festive season and the spatial distribution of monsoon rainfall are expected to play a key role in boosting broad-based demand.
Government capital expenditure (Capex) front-loading was also highlighted, with a growth of 61 per cent in April and 39 per cent in May. There has been a notable momentum in order placement and a significant pickup in defence spending.
Additionally, the Reserve Bank of India (RBI) has reduced the repo rate by 100 basis points (bps) and plans to cut the cash reserve ratio (CRR) by another 100 bps gradually.
These measures are aimed at improving liquidity in the financial system and stimulating credit growth, which was recorded at 9.5 per cent in the first quarter of FY26.
If the conditions remain favourable, the report outlined that the Nifty index will continue the journey of touching new highs. (ANI)