Indian equity markets witnessed a subdued session on Thursday, with BSE Sensex falling 150.63 points or 0.20% to close at 73,832.55 and Nifty 50 declining 53.35 points or 0.23% to settle at 23,161.60. According to The Hindu BusinessLine, the recovery proved fleeting despite a brief rebound on dip-buying as oil prices eased, weighed down by an increasingly fragile global backdrop. Most sectoral indices ended in negative territory, with defence and IT stocks witnessing the sharpest declines. Media emerged as the top-performing sector, while pharma and private banks posted modest gains. During the session, TCS, Wipro, HCLTech and LTM touched fresh 52-week lows, reflecting the broader technology sector weakness.
PL Capital has reduced its Nifty 50 target to 26,449 from 27,080 earlier, as reported by Livemint. The brokerage firm expects the markets not to correct further despite the challenging environment. According to PL Capital's analysis, Nifty 50 is currently trading at 16.5x 1-year forward EPS, which represents a 13.6% discount to the 15-year average PE of 19.1x and an 18.7% discount to the 10-year average PE of 20.3x. The revision comes as the benchmark index has fallen more than 10% in 2026 due to prolonged Iran-US war, surging crude oil prices, and weak earning growth. Brent crude oil traded lower during the day, while the rupee weakened to 95.76 against the US dollar, adding to market pressures.
In its base case scenario, PL Capital values Nifty 50 at 10% discount to the 15-year average PE of 17.2x with FY28 EPS of ₹1,538, arriving at the 12-month target of 26,449. As reported by Livemint, the brokerage firm's bull case values Nifty 50 at PE of 19.1x and cut its bull case target to 29,387 from 30,089 earlier. The bear case assumes the index can trade at the lowest point of PE during the eurozone crisis in 2013 at 13.5x, arriving at a target of 20,771 which would likely assume a worst-case scenario in current context. Global brokerage Citi also lowered its Nifty valuation multiple to 18 times from 19 times earlier and trimmed its Nifty target to 26,000 from 27,000, reflecting similar cautious sentiment across major brokerages.
According to PL Capital's report, India would have significant spike in subsidy for fertilizers, food and fuel and loss of excise on petroleum products, which could put an incremental fiscal burden of ₹4-5 lakh crore. As reported by Livemint, the brokerage firm doesn't rule out the possibility of RBI repo rate hike from 2H27. While balance of trade including services remain comfortable, sustained FII selling, pressure on remittances and crude spikes are placing the currency under stress. Persistent foreign institutional investor outflows and a weaker rupee also weighed on sentiment, with market breadth remaining firmly negative as of the latest session. Of the 4,389 stocks traded on BSE, 1,384 advanced, 2,807 declined and 198 remained unchanged.
PL Capital believes Private banks, NBFC, Metals, capital goods, defence, Data centres, Renewables, Railways, Ports, Ship Building, Semiconductors and Healthcare are themes to play, while remaining cautious on IT Services, Consumer, Chemicals, Agri and Oil and Gas. In its model portfolio, the brokerage firm added HDFC Asset Management Company and increased weights on Tata Steel, JSW Steel, Larsen & Toubro, Bharat Electronics, Britannia Industries, Nestle India, Bajaj Finance, Bharti Airtel and Adani Ports & SEZ. It also removed Ipca Laboratories, LG Electronics India, Apeejay Surrendra Park Hotels, Mahindra & Mahindra and Fortis Healthcare from high conviction picks, while adding JSW Infrastructure, DOMS Industries, Rainbow Children Medicare, Ajanta Pharma and Jindal Stainless. Nifty midcap 100 and Nifty smallcap 100 declined 0.7 and 0.8% respectively, with 77 stocks hitting 52-week highs and 119 touching fresh 52-week lows during the session.
