“The markets are often seen as a pendulum that moves between greed and fear,” said Nimesh Chandan, CIO, Bajaj Finserv Asset Management. “We estimate the fair value as 26,300 that’s where we believe the centre of the pendulum is.”
The growth rate in FY26 is likely to be better than in FY25, and the earnings growth in Nifty is anticipated to be 12% in FY26 and 15% in FY27. Chandan said that the fiscal policy has become more demand oriented and the monetary policy also helped in terms of infusing liquidity in the market.
The asset management company said that after the correction between September and March, pockets in the midcap and smallcap space trading at reasonable valuations despite the recent pullback. Benchmark Nifty is also trading close to its long-term average on a price to earnings basis.
“Large-cap valuations are reasonable, the risk reward is favourable, but because of the correction that came in the last few months or calendar year to date, we have seen some sectors, some pockets in mid caps and small caps also correct and that brings us some opportunities,” said Chandan.
The outlook for rate sensitives & domestic oriented sectors such as NBFCs, smaller banks, realty, home improvement along with consumption while the asset management company remains cautious in the IT.
