19.2 C
Friday, August 19, 2022
HomeBusinessNifty target at 17,500, Sensex to reach 58,300 as Indian economy picks...

Nifty target at 17,500, Sensex to reach 58,300 as Indian economy picks up pace, says ICICI Direct


Related stories

Advantages of Windows 10 Activator Txt

Computers have made the life of human beings run...

Why do small businesses need professional web design services?

Web design is an essential element of digital marketing–...

Unique Methods of Relaxation That Are Surprisingly Effective

It might not make sense, but everyone knows what...

Morgan Stanley downgrades Elanco to equal weight on profit questions

Morgan Stanley is moving to the sidelines on...

M&N Locksmith Chicago: Locksmith Services – Experience The Difference With Us!

Locksmithing is an age-old industry. People would usually use...

Over the next few years, ICICI Direct believes double-digit earnings growth will be led by the automobile sector.
(Image: REUTERS)

Robust domestic macroeconomics could help NSE Nifty 50 scale 17,500 and take the S&P BSE Sensex to 58,300 as India’s economy recovers from the covid slump, said domestic brokerage firm ICICI Direct. “With the peak of the Covid resurgence behind us, increasing pace of vaccination domestically and calibrated state-specific unlocking underway, we expect economic activity to bounce back sharply in the remaining nine months of the financial year 2021-22,” the brokerage firm said in a report. Benchmark indices have already surged higher helped by strong corporate earnings. The target set for Nifty implies a 10% upside potential from current market levels.

Economy bouncing back

Headline indices showed resilience during the second wave of covid-19. The recent rally in indices was aided by encouraging corporate earnings in the January-March quarter, led by the upswing in key commodities prices and strong underlying demand prospects. Further, Good and Services Tax (GST) collections continue to remain above the Rs 1 lakh crore mark standing testament to the robust domestic macroeconomics, according to the report. Foreign institutional investors (FII) have also resumed investing in India, turning net buyers in June 2021 (MTD inflow at US$2.1 billion) against selling activity observed in April 2021 and May 2021.

Nifty earnings to grow 24% CAGR

Analysts at ICICI Direct said their positive view for domestic markets is further reinforced by the step-up capex by the government, which will create a multiplier effect on the economy. “We expect the present broad-based up move in markets to continue, with small-cap and midcaps leading the gains,” they added. Stellar January-March quarter results have led ICICI Direct to upgrade earnings estimates to the tune of ~7.5%. “Nifty EPS is now expected to grow at a CAGR of 24.2% between FY21- 23E. Assigning the same PE multiple of ~22x to FY23E earnings, our resultant Nifty target is at 17,500 with equivalent Sensex target at 58,300,” the report added.

Watch these sectors

Over the next few years, ICICI Direct believes double-digit earnings growth will be led by the automobile sector (base effect), capital goods space and index heavy BFSI space, which also includes the insurance sector. Meanwhile, IT and pharma space continue to remain the favoured structural plays in the market.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Source link

Latest stories