2 weeks ago
Nifty 50 negative returns; time to increase equity bets?
The Nifty 50 is a scoreboard for India's 50 biggest companies.
Over the last year, that scoreboard went down by a little less than 2%.
The drop happened because some foreign investors sold their shares, world events made people nervous, and company profits stopped growing as fast as before.
But experts say India's economy is not in real trouble — the market is just taking a breather.
People in India kept investing small amounts every month, which helped stop prices from falling too much.
Some experts think the market could climb to about 27,000 points by March 2027 if company profits grow by around 12%.
But there are risks too — problems in other countries could make it fall by as much as 20%.
So experts say it is fine to invest a little more, but only in good companies.
They like businesses that build things, make power, help the army, and manage money.
The Nifty 50 delivered a negative return of about 2% over the past year, hit by geopolitical uncertainties, foreign capital outflows, and an earnings-valuation mismatch.
Foreign portfolio investors withdrew nearly $19.7 billion from Indian equities during FY26, while domestic SIP inflows and institutional buying cushioned the impact.
Experts attribute the slump to earnings moderation and valuation compression rather than any structural deterioration in India's growth outlook.
The Nifty 50 could reach about 27,000 by March 2027 in a best-case scenario with roughly 12% EPS growth, but an unwinding of Japan's yen carry trade could trigger an approximately 20% drawdown.
Markets are expected to stay stock-specific, with experts recommending selective exposure to manufacturing, infrastructure, power, defence, and financial services.
- Who
- The Nifty 50 index and Indian equity investors, with expert views from Vinit Bolinjkar (Ventura), Karan Aggarwal (Ametra PMS), and Harshal Dasani (INVAsset PMS).
- What
- The Nifty 50 delivered a negative return of about 2% over the past year, and experts assessed whether it is the right time to increase exposure to Indian equities.
- Where
- India's equity markets, centred on the Nifty 50 index.
- When
- The one-year period ending around Independence Day 2026, with FPI outflows during FY26 and an outlook running to March 2027.
- Why
- Geopolitical uncertainties, foreign capital outflows, and an earnings growth-valuation mismatch weighed on market performance.
Key facts
- Index
- Nifty 50
- 1-year return
- Approximately -2% (to Independence Day 2026)
- FPI selling in FY26
- Nearly $19.7 billion
- Best-case FY27 target
- About 27,000 by March 2027
- Assumed EPS growth
- About 12%
- Downside scenario
- Approximately 20% drawdown if yen carry trade unwinds
- Banking loan growth
- High-teens percent
- Preferred sectors
- Manufacturing, infrastructure, power, defence, financial services, selective consumption
Quotes
Vinit Bolinjkar
Head of research at Ventura Capital
“The key catalyst for markets will be a revival in corporate earnings. Earnings growth is expected to improve as consumption demand stabilises, input cost pressures moderate and operating leverage benefits accrue across sectors. Recent earnings trends indicate gradual improvement, with brokerages highlighting stabilising profits and improving earnings visibility.”
livemint.com
“Financials, power, energy, metals and capital‑market‑linked businesses appear better placed where fundamentals justify valuations.”
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