Figure 1: The Sensex has declined by approximately 14% from its peak
India is poised for recovery from a cyclical slowdown
Figure 2: GDP rebounds in 4Q24
Figure 3: India’s inflation has fallen below the RBI’s target
Relatively shielded from Trump’s tariffs
Figure 4: US’ trade deficit with India has almost doubled since 2020
Figure 5: India has a relatively small exposure to US trade
Long-term growth drivers remain intact, but challenges remain
Figure 6: India’s stock gains have been eroded by currency depreciation
Figure 7: India’s current account has persistently been in deficit
Opportunity to add shares at reasonable valuations
Figure 8: The Sensex is near its 15-year historical forward PE
Table 1: Projections for the Sensex Index
|
Sensex Index |
2023 |
2024E |
2025E |
2026E |
|
Earnings Per Share (EPS) |
2902.09 |
3399.27 |
3803.83 |
4385.82 |
|
Earnings Growth YoY |
15.04% |
17.13% |
11.90% |
15.30% |
|
PE Ratio (X) |
26.31 |
22.46 |
20.07 |
17.41 |
|
Target Price (based on a fair PE of 19X) |
83,330 |
|||
|
Upside Potential |
9.15% |
|||
|
Source: Bloomberg Finance L.P., iFAST Compilations. Data as of 20 March 2025 |
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Figure 9: Share prices are driven by earnings growth in the long run
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