Nifty Could Hit 27,589 in 12 Months, Says PL Capital; Near-Term Pain Seen

The Near-Term Headwinds

“Higher global bond yields and relatively subdued dollar-adjusted returns are also likely to constrain foreign investor flows,” said Amnish Aggarwal, Co-Head – Institutional Equities, PL Capital.

Why It Matters: The Monsoon Risk Is Underrated

Much of the market conversation has focused on oil and foreign flows. PL Capital’s report puts the spotlight on a domestic risk that is easy to overlook: the weather. With reservoirs well below last year’s levels, the coming Rabi season is at risk, which could hit farm incomes, rural spending and food prices. For states like Rajasthan, where irrigation depends heavily on stored water, this matters directly.

At the same time, the brokerage sees enough strength in corporate India to justify a higher one-year target. It expects Q2 FY27 sales to grow 16.2% and EBITDA 14.7% (excluding oil and gas), suggesting businesses remain resilient despite the headwinds.

Where It Sees Opportunity

PL Capital remains overweight on capital goods, healthcare, banks, metals, diversified financials, telecom and ports, sectors tied to domestic investment and long-term growth. It urged investors to be selective and focus on companies with strong fundamentals.

Tuesday’s Rally

Markets rose sharply on Tuesday. Sensex gained over 1,100 points, or 1.54%, to close at 73,033.78, while Nifty rose 358.60 points, or 1.6%, to 22,721.95.

The Bottom Line

PL Capital’s message is one of patience: expect more turbulence in the months ahead, but the brokerage believes the Nifty can deliver solid gains over a year for investors who stay selective.

With inputs from IANS.