Kotak Securities sees Nifty at 26,100 by December 2025; BFSI, IT, real estate, pharma among top sectors

Brokerage Kotak Securities believes that the benchmark NSE Nifty50 index may touch the 26,100-mark in 2025 in the base case scenario, indicating an upside of 6% from the current levels.

The 50-share index has gained 13% on a year-to-date basis till November 9.

On the other hand, it believes that Nifty may hit the 28,800-mark in the bull case scenario and 23,300 levels in bear case scenario. Kotak Securities believes that government and private capex is expected to revive in 2025. The brokerage expects the government to spend Rs 6.9 lakh crore in the second half of FY25.

Kotak Securities highlighted that government spending has been slower than expected due to the recent general elections. However, it anticipated an increase in spending during the third and fourth quarters of FY25.

“In Q3FY25, the estimated wedding of 50 lakh couples to spur consumption and growth,” Kotak Securities said, adding the country also has favourable demographic with large young population which may further support consumption.

India is the second-best country after the USA which has strong average return on equity. “India and USA can command higher valuations due to strong return on equity,” Shrikant Chauhan, Head of Equity Research, Kotak Securities said.

Shripal Shah, MD and CEO, Kotak Securities said, “Long-term outlook stood cautiously optimistic. We advice investors to stay invested. Investors should look for value rather than momentum and moderate their expectations for return. India remains the most attractive investment option across the world.”

While sharing its view on inflation, Kotak Securities believes that inflation may cool off in the coming months and the current account deficit to remain in favour as the exports contribution rises.

However, the brokerage expects the RBI to begin easing in early FY26. The uncertain global policy environment (US trade policy, geopolitics and others) and related flight of capital could further keep the RBI cautious in the near term.

Kotak Securities also thinks the profits of the Nifty 50 index to grow by 4.9% (EPS of 1,036) in FY25, 16.3% (EPS of Rs 1206) in FY26 and by 14% in FY27 (EPS of Rs 1,372). It further added that domestic equity markets could see consolidation for a while due to rich valuations. BFSI, IT, realty and pharmaceuticals and healthcare are among the preferred sectors of Kotak Securities.