The Benchmark Indices are trading positively during Monday’s trading session, with the Sensex increasing by around 253.3 points, or 0.35 percent, currently trading at 74,589.2. Similarly, the Nifty 50 index has climbed by about 71.3 points, or 0.32 percent, and is currently at 22,625.
Over the previous five trading sessions, the Indian stock market as a whole has bounced back, with the Nifty 50 index experiencing a rise of roughly 2.3 percent, while the Sensex saw a gain of about 2.1 percent.
Goldman Sachs has reduced its 12-month Nifty target by around 5.6 percent to 25,500 from the previous target of 27,000, representing about a 13 percent potential upside from the current level of 22,625.
The global brokerage firm maintained a “marketweight” position on India, having downgraded it from “overweight” in October 2024, citing a cyclical slowdown in India’s economic growth and corporate profits, according to Reuters.
The brokerage firm anticipates low double-digit earnings growth for Indian companies over the next year. While they believe the worst of the economic slowdown and earnings contraction may be over, they expect only a gradual recovery in earnings growth.
Goldman Sachs also notes that India’s equity markets will likely remain volatile due to global uncertainties, particularly in relation to reciprocal tariffs. It suggests that the recent market downturn has made valuations in large-cap stocks more reasonable, though small- and mid-cap stocks still appear overpriced.
India’s benchmark indices, the Nifty and Sensex, are currently about 14 percent below their all-time highs, while small- and mid-cap stocks are down by 22 percent and 19 percent, respectively, from their peak levels.
Among sectors, Goldman Sachs continues to favour information technology, consumer staples, automobiles, telecommunications, internet services, and insurance.
Among sectors, Goldman continues to remain “overweight” on information technology (IT), consumer staples, autos, telcos, internet, and insurance.
Written by Shivani Singh
