Skip to content
Search

Latest Stories

Where will be Sensex in next five years?

Where will be Sensex in next five years?

AS Indian stock markets have hit record highs, there are mixed signals from analysts about the road ahead for equities in the short term.

With the BSE Sensex trending at dizzy levels of around 60,000, market participants raise a note of caution about the near future, while largely maintaining bullish views about long term outlooks.


Stock markets have rallied worldwide, but India outpaced its global peers, surging 25.77 per cent since January. While the Nasdaq went up 16.75 per cent during the same period, the UK’s FTSE 100 saw a modest uptick of 7.30 per cent.

Analysts feel that Indian equities, which are richly valued now, could become vulnerable to earnings disappointments and negative news flows, although there are views that a full recovery from the pandemic could improve the revenues of companies.

AK Prabhakar, head-research at IDBI Capital, expects the market to double from here to around 120,000 levels in five or six years, but the continuous rally so far without meaningful corrections since the 2008-2009 lows is a matter of concern.

“Post 2008-2009 we have never seen any major correction. A rally for almost 13 years without a correction is a concern in the short term. But in the long term, I am very bullish as I expect the market to double in the next five-six years, which is almost 15 per cent CAGR (compounded annual growth rate) returns,” he told Eastern Eye.

“I would be 80 per cent invested” at current levels, he said, adding that in case of a correction, he would fully invest his investible surplus.

According to Christopher Wood, global head of equity strategy at Jefferies, the Sensex is headed towards 100,000 levels in five years, although there is a risk of a correction in the short term.

As buying from domestic and foreign funds and retail investors meant the Sensex more than doubled from the March 2020 lows, India’s market capitalisation has soared to $3.44 trillion (£2.51trillion), surpassing France in the process to become the fifth biggest in the world.

At the current price-to-earnings (PE) ratio of 25.53, the bellwether index of the Bombay Stock Exchange is the second most expensive among large markets globally, behind the Nasdaq.

Prabhakar agreed that the rally has made the market expensive in select sectors.

“Now earnings growth or EPS expansion looks possible as multiple factors, notably Covid-19, have led to a major shift from unorganised to organised sectors. Most companies have learned to cut costs which has boosted margins.”

India, which is benefiting from the current trend of multinational companies geographically diversifying their manufacturing away from China, is the “best place for equities” with the caveat that investors are in the right sectors and stocks, he said.

According to him, the private life insurance sector, telecom, retail, solar energy, electric vehicles, realty, and select big banks look attractive.

The market analyst advised investors to be cautious about automobile companies, microfinance institutions and small banks.

More For You

‘All options on the table’ as Britain
prepares for likelihood of US tariffs

Sir Keir Starmer with Jonathan Reynolds

‘All options on the table’ as Britain prepares for likelihood of US tariffs

BRITAIN is likely to be hit by US tariffs despite making “rapid progress” over a trade deal with Washington, prime minister Sir Keir Starmer said on Tuesday (1).

He spoke as US trading partners around the world braced for an expected fresh raft of tariffs from president Donald Trump, in addition to levies already imposed on steel and those set to take effect this week on cars.

Keep ReadingShow less
single-use vapes-iStock

Analysis by Material Focus estimates that 8.2 million vapes are discarded or littered each week in the UK—equivalent to 13 every second. (Representational image: iStock)

iStock

Shops told to clear single-use vapes before ban starts on June 1

SHOPS across the UK have until 1 June 2025 to sell off remaining stocks of single-use vapes before a nationwide ban comes into force.

The legislation, confirmed last year, follows a government consultation that showed strong support for restricting their sale and supply.

Keep ReadingShow less
Primark-London-Getty

During his 15-year tenure, Marchant expanded Primark’s store network to more than 450 locations across 17 countries in Europe and the United States. (Photo: Reuters)

Primark chief Paul Marchant steps down after misconduct probe

PAUL MARCHANT, the head of fashion retailer Primark, has resigned with immediate effect after admitting to an "error of judgment" in his behaviour towards a woman in a social setting.

Associated British Foods (AB Foods), Primark's parent company, announced his resignation on Monday.

Keep ReadingShow less
Jaguar’s bold gamble: Can it woo young, wealthy drivers with a £123k EV?

Jaguar’s bold gamble: Can it woo young, wealthy drivers with a £123k EV?

JAGUAR’S ambition to seduce younger, richer drivers was on full display in Paris with a presentation of its newest prototype, the Type 00, which promises all-electric luxury... at a steep price.

The low-slung, muscular-looking concept car presented to European reporters last Friday (21) prefigures a production model expected mid-2026 at a base cost of €150,000 (£123,472.8).

Keep ReadingShow less
Starmer-Trump-Getty

Trump has suggested the possibility of a 'great' trade deal that could help the UK mitigate the impact of tariffs he has pledged to introduce. (Photo: Getty Images)

Starmer, Trump talk trade deal progress in 'productive' discussion

KEIR STARMER and Donald Trump spoke on Sunday about ongoing UK-US trade negotiations, with Downing Street describing the talks as "productive."

Since leaving the European Union, the UK has been working to secure a trade agreement with the United States. Successive British governments have pursued a deal, but it has remained elusive.

Keep ReadingShow less