Brokerage firm Citi Research expects benchmark Nifty 50 index to reach 28,000 points by end-2027, citing a strong earnings outlook, lower oil prices and the prospect of slower AI capex as tailwinds for equities in Asia's third-largest economy.
The target implies an upside of about 12% from the Nifty 50's last close of 24,986.4.
Indian equities have until recently lagged global peers as enthusiasm around the AI trade and elevated crude oil prices weighed on the outlook for the world's third-largest oil importer.
Citi's bullish outlook comes after the benchmark Nifty 50 surged more than 10% over the seven sessions through Friday, buoyed by a resurgence of foreign portfolio investors (FPIs) as AI-linked trades unwound and oil prices retreated.
"Over the past two years, AI has crowded out almost everything else. Our analysis suggests a 100 bps increase in India active weight could drive $12 billion of inflows," Citi said in its India equity strategy note dated November 8.