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Nifty's Earnings Surge: 16% Growth Forecast Amid Economic Revival

Motilal Oswal's latest report projects a promising trajectory for Nifty 50 earnings, forecasting substantial growth in FY26 and FY27. The prediction is backed by supportive policy measures, improving macroeconomic conditions, and a strengthening domestic investor base. Key sectors like BFSI, manufacturing, and consumption are expected to drive this growth. The report highlights a potential shift from single-digit to sustainable double-digit earnings growth in the coming years.

Key Points: Nifty 50 Earnings Outlook Motilal Oswal Growth Forecast FY27

  • Nifty earnings expected to grow 8% in FY26 and 16% in FY27
  • Policy measures and macro resilience driving economic growth
  • Financials and manufacturing sectors show promising recovery prospects
  • Valuations remain reasonable, close to long-term averages
2 min read

Nifty earnings expected to grow 16 pc in FY27: Report

Motilal Oswal predicts robust Nifty earnings growth, driven by policy reforms, consumption revival, and strengthening economic fundamentals.

"We believe this marks the beginning of a turnaround in India's domestic growth momentum - Motilal Oswal Report"

New Delhi, Oct 16

The average earnings from Nifty 50 companies are expected to grow 8 per cent in FY26 and 16 per cent in FY27, driven by policy measures, macro resilience, and a maturing domestic investor base, a report said on Thursday.

As India's markets enter Samvat 2082, the Motilal Oswal Financial Services Ltd (MOFSL) report said that it is positive on BFSI, capital markets, consumption, manufacturing, and digital sectors.

The broking firm noted policy measures that increased liquidity and demand, such as a 100-basis-point repo cut, a 150-basis-point CRR reduction, Rs 1 lakh crore in income tax relief, GST 2.0 reforms, and reduced inflation, have improved consumer sentiment.

"We believe this marks the beginning of a turnaround in India's domestic growth momentum, with a significant pickup in consumption paving the way for a robust revival in the private capex cycle. This, along with the improving earnings trajectory, should lend support to Indian equities," the report said.

Motilal Oswal said that these tailwinds support a forecast for a shift from single-digit earnings growth to sustainable double-digit growth in the second half of FY26.

"The underlying fundamentals have strengthened - supported by a 7.8 per cent GDP growth in Q1FY26, easing inflation at 1.5 per cent in September 2025 compared to 5.5 per cent in September 2024, and a supportive policy environment that continues to boost investor confidence," it said.

Valuations are reasonable and close to long-term averages at approximately 20 times FY26 earnings. Mid and small caps are trading at a slight premium, indicating a need for selective stock picking, the brokerage said.

Financials are set for earnings recovery in H2FY26, aided by lower borrowing costs, improving NIMs, and steady deposits, the brokerage firm said.

Capex revival and policy reforms should drive multiyear growth for the manufacturing sector, positioning India as a key global manufacturing hub, the report noted.

- IANS

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Reader Comments

R
Rohit P
While the numbers look promising, I hope this growth actually reaches the common man. We've seen many such projections before that didn't translate into real benefits for retail investors. Need to see actual implementation of these policies.
A
Arjun K
The manufacturing sector focus is exactly what India needs! With China+1 strategy, we can become a global manufacturing hub. Good to see inflation under control at 1.5% - this will boost consumption significantly. 🏭✨
S
Sarah B
As an NRI investor, these projections make India very attractive compared to other emerging markets. The policy stability and 7.8% GDP growth are impressive. Looking to increase my exposure to Indian equities.
V
Vikram M
The financial sector recovery mentioned is crucial. With lower borrowing costs and improving NIMs, banks should perform well. This could be good for my banking stocks portfolio. Hope the revival in private capex cycle happens as projected.
K
Kavya N
Positive about the digital sector focus! As a tech professional, I see huge growth potential in digital India. The maturing domestic investor base is also a good sign - more Indians are understanding equity markets now. 💻📱

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