Nifty is expected to scale up to 25,810 level by December 2024, Prabhudas Lilladher said in its latest strategy report. The upward mobility in Nifty is attributed to the continuation of NDA Govt and La Nina led normal monsoons which is expected to provide stability in policies and boost demand economic growth, the brokerage added.
“Recently, the NIFTY reached its all-time peak, but subsequently experienced a correction of around ~4% attributed to escalating geopolitical tensions, fluctuations in crude oil and commodity prices, and differing perspectives on the anticipated interest rate adjustments by the US Federal Reserve. Concurrently, India is immersed in the General Elections, a pivotal event of this decade. Despite opinion polls forecasting a comfortable victory for the NDA, the markets are not ready for a repeat of the 2004 election outcome, where the BSE Sensex plummeted by 15.5% on May 17, 2004, the day election results were announced,” said Amnish Aggarwal, Head of Institutional Research, Prabhudas Lilladher.
According to PL, NIFTY is currently trading at 18.3x 1-year forward EPS, which is at 3.7% discount to 15-year average of 19x. On the base case, PL values NIFTY at a 15-year average PE (19x) with March26 EPS of 1358 and arrive at 12-month target of 25810 (25363 based on 18.9x Dec 25 EPS of Rs1342 earlier). Bull Case, PL values NIFTY at 5% premium to 15-year average PE 20x (6% premium earlier) and arrive at bull case target of 27100 (26885 earlier). Bear case, NIFTY can trade at 10% discount to LPA with a target of 23229 (22066 earlier).
