ETMarkets.com Samvat survey: Top brokerages see Sensex at 44,000 by next Diwali

NEW DELHI: Samvat 2076 may spin wealth for investors in top listed companies, as Sensex and Nifty look all set to scale record highs, top brokerages said in ETMarkets.com’s Samvat survey.

Analysts from 14 leading brokerages, who took part in the survey, expect Sensex and Nifty to rise 7-13 per cent in the new Hindu accounting year. This would be similar to the 10-11 per cent return that the two indices delivered in Samvat year that ends on October 26.

For Sensex, the analysts have set their targets anywhere between 42,000 and 44,000 by next Diwali, while they see Nifty50 to easily breach the 13,000 mark by that time. Diwali marks the start of the new Hindu accounting year, Samvat.


The most bullish analysts projected Sensex to touch the 46,000 mark and Nifty to top 14,250 in a year’s time.

These bullish projections are pegged on a likely revival in corporate earnings growth following the recent corporate tax cut. Analysts believe the recent steps announced by the government to lift demand, the push towards privatization and stability in global markets should help domestic businesses and their stocks grow over the next few months.

“The worst is behind us, and the seeds for a convincing long-term economic revival have been sowed,” said Pankaj Bobade, Head of Fundamental Research at Axis Securities.

“Rising investment coupled with a resurgence in demand would put the Indian economy on an accelerated growth path,” he said.

Sandeep Raina, Senior Vice-President at Edelweiss Professional Investor Research, expects Nifty to touch 12,800-13,000 levels by June 2020, driven mainly by earnings revival on the back of the corporate tax cut.

“We expect Nifty earnings to be around Rs 700 for FY21. When you assign a PE of 18-18.5 times, our index target looks achievable," he said.

Abhimanyu Sofat, Head of Research at IIFL Securities, has a bigger Nifty target of 14,000 for the next Samvat. He sees Sensex around 42,000 level by next Diwali. Karvy Broking is the most bullish of the lot. It projects Sensex at 46,000 and Nifty at 14,250, suggesting 17-22 per cent potential rally.

Pankaj Pandey of ICICI Direct values Nifty50 at 18.5 times FY21 earnings. He has a target of 13,150 for the NSE barometer and 43,000 for Sensex by next Diwali.

“For Nifty, our target works out to 13,000 (ranging between 12,750 and 13,250). The target for Sensex works out to 43,500 (between 42,700 and 44,400),” said Rusmik Oza, Head of Fundamental Research at Kotak Securities.

HDFC Securities has Sensex target at 42,800 and Nifty target at 12,700.

Gaurav Dua of Sharekhan says the indices are likely to rise 10-12 per cent over the next 12 months. “Nifty is likely to hit new highs by next Samvat. We expect FY21 to be a year of high growth, primarily on account of a low base of FY20 and the policy reforms, benefits of good monsoon, liquidity push, resolution of stressed assets and lower interest rate regime," said Dharmesh Kant, Head of Retail Research at IndiaNivesh.

Nifty50 EPS should see traction of over 20 per cent in FY21, he estimates. Discounting FY21, he values Nifty50 at 21 times conservatively, setting a target of 12,600 for the index.

Religare has set its Nifty target for the year at 12,200 and Sensex target at 43,000. Samco Securities pegs Nifty target at 12,700 and Sensex target at 42,800. Motilal Oswal Securities did not set any target for the indices.