The Nifty 50 index could rise around 24 per cent from current levels to 32,032 by December 2026 in a bull-case scenario, Kotak Securities said in a recent note.
“We value Nifty at a 10 per cent premium (at 22x) to the 10-year average price-to-earnings of 20x on 2027-28 estimated (E) earnings per share (EPS) of Rs 1,456, and arrive at a December 2026 Nifty target of 32,032,” the analysts wrote.
In the base case, the brokerage pegs Nifty at 29,120 by December 2026, nearly 13 per cent above current levels.
Its bear-case scenario places the index at 26,208, barely 1.5 per cent higher.
“In the base-case target, we expect Nifty 50 profits to grow 8.2 per cent (EPS of Rs 1,077) in 2025–26 (FY26E), 17.6 per cent (EPS of Rs 1,268) in 2026-27 (FY27E), and 14.8 per cent in 2027-28 (FY28E) (EPS of Rs 1,456). Currently, Nifty trades at 23.9x FY26E, 20.3x FY27E, and 17.7x FY28E,” the note said.
Over the past 12-15 months, Indian markets have remained largely flat and have notably underperformed most developed and emerging peers during this period.
“Some of our earlier concerns — particularly around high valuations and the risk of earnings downgrades — have played out over the last 12-15 months, reducing downside risks and improving the overall market setup,” Kotak Securities said.
The brokerage expects FY27 net profit growth to be broad-based across sectors.
“Nifty 50 net profits grew 6.6 per cent in 2024-25, and growth is expected at 8.2 per cent in FY26E, accelerating to 17.6 per cent in FY27E.
"Our preferred sectors include banking, financial services and insurance, information technology, healthcare, and hospitality,” it added.
Kotak Securities remains positive on gold and silver.
Gold’s medium-to-long-term fundamentals, it said, look favourable as the US fiscal position deteriorates, with rising debt-servicing costs likely pushing policymakers towards implicit financial repression to keep real rates low — historically a tailwind for gold.
“Ongoing currency debasement risks and diversification away from fiat assets support sustained strategic buying by investors and central banks.
"Combined with persistent fiscal deficits, slower global growth, and rising geopolitical concerns, gold appears to be entering a ‘higher-for-longer’ regime and may scale $5,000 over the next year,” the note said.
Industrial demand for silver, meanwhile, is likely to recover as end-uses expand, driven by strong growth in photovoltaic deployment, rapid build-out of electric vehicle charging networks, improved battery technologies,among others.
“With these factors in play, silver prices in 2026 are expected to remain fundamentally strong, in a broad range between $48 and $70 per ounce, with potential spikes towards $75 under conditions of aggressive monetary easing ,” Kotak Securities noted.
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