Nifty@28,000 by Dec 2027? Why PL Capital is positive amid selective signs, EPS downgrades
PL Capital’s strategy update values Nifty at a 5 per cent discount to its 15-year average PE, pegging the index at 18.3 times with a December 2027 EPS forecast of 1,525.
- Feb 27, 2026,
- Updated Feb 27, 2026 1:37 PM IST
Nifty has remained confined within a narrow 5-6 per cent trading band over the past nine months, a noted PL Capital, attributing the long consolidation following a 9-9.5 per cent reduction in Nifty EPS projections for FY26 and FY27. Its latest report highlights that global geopolitical uncertainties and ambiguities surrounding tariffs have also contributed to this consolidation.
PL Capital notes encouraging signs emerging from recent trade agreements, particularly with the USA and EU, and observes that a revival in demand is being supported by lower inflation, rationalised GST, and a softer interest rate environment.
PL Capital’s strategy update values Nifty at a 5 per cent discount to its 15-year average PE, pegging the index at 18.3 times with a December 2027 EPS forecast of 1,525. The 12-month target for Nifty is now 27,958, down from 28,814. For the bull case, Nifty is valued at a PE of 20 times (target: 30,497), while the bear case assumes a 10 times discount to the long-period average (target: 26,486).
Trade deals are expected to boost traditional sectors like textiles, gems and jewellery, marine, leather, and handicrafts, putting India as a manufacturing hub for auto components, data centers, defense, aerospace, and consumables it noted. The brokerage remains overweight on banks, diversified financials, healthcare, consumer, auto, and capital goods/defense as key themes.
"We believe renewed thrust on Defense, Data Centers, Infrastructure/Ports, High Speed Rail Corridors, Renewables and Manufacturing ecosystem bodes well for growth in coming years. Next 5-10 years will be driven by asset creation and technology intensive industries which will find favor with markets," said PL Capital.
PL Capital reports that third-quarter results beat estimates, but Nifty EPS forecasts were trimmed by 0.7-2.9 per cent for FY 26/27/28. Sales, Ebitda and PAT growth for its coverage universe were 9.9 per cent, 16.4 per cent, and 16.7 per cent year-on-year (YoY), respectively.
Key sectoral performers included auto, EMS, renewables, NBFCs, hospitals, cement, durables, telecom, logistics, and ports, all of which surpassed 15 per cent sales growth. Capital goods, consumer, metals, and pharma reported between 10-15 per cent sales growth.
On the profitability front, auto, building materials, capital goods, NBFCs, oil & gas, and telecom posted over 20 per cent Ebitda growth. Cement, logistics, EMS, and renewables achieved over 30 per cent EBITDA growth, while chemicals, media, education, and travel lagged.
There was a near balance in analyst rating changes, with 18 upgrades and 17 downgrades across industries. Capital goods and oil & gas had four upgrades each, while IT services had two. Oil & gas had three downgrades, and several other sectors saw two downgrades each.
Major rating upgrades included Hindustan Petroleum Corporation, Bharat Petroleum Corporation, JSW Steel, Cholamandalam Investment and Finance Company, Ingersoll Rand, Apar Industries, Tech Mahindra, Tata Elxsi, and Torrent Pharma. Downgraded companies included Shree Cement, Viniti Organics, Bajaj Electricals, Hindalco Industries, Oil and Natural Gas Corporation, OIL India, Mahanagar Gas, Lupin, Safari Industries, and Bharat Electronics.
PL Capital’s model portfolio remains overweight on banks, diversified financials, healthcare, consumer, auto, and capital goods/defence, while maintaining underweight positions in IT services and commodities. Allocations have increased to capital goods, NBFC, consumer, and metals, and reduced in auto and IT services.
PL Capital has added Torrent Pharma to the model portfolio. High conviction picks have been reshuffled, with HealthCare Global Enterprises, Ingersoll-Rand (India), and Ipca Laboratories have been included. It has removed HDFC Life Insurance Company, State Bank of India, Aster DM Healthcare, Fine Organic Industries and Max Healthcare Institute from the model portfolio.
Nifty has remained confined within a narrow 5-6 per cent trading band over the past nine months, a noted PL Capital, attributing the long consolidation following a 9-9.5 per cent reduction in Nifty EPS projections for FY26 and FY27. Its latest report highlights that global geopolitical uncertainties and ambiguities surrounding tariffs have also contributed to this consolidation.
PL Capital notes encouraging signs emerging from recent trade agreements, particularly with the USA and EU, and observes that a revival in demand is being supported by lower inflation, rationalised GST, and a softer interest rate environment.
PL Capital’s strategy update values Nifty at a 5 per cent discount to its 15-year average PE, pegging the index at 18.3 times with a December 2027 EPS forecast of 1,525. The 12-month target for Nifty is now 27,958, down from 28,814. For the bull case, Nifty is valued at a PE of 20 times (target: 30,497), while the bear case assumes a 10 times discount to the long-period average (target: 26,486).
Trade deals are expected to boost traditional sectors like textiles, gems and jewellery, marine, leather, and handicrafts, putting India as a manufacturing hub for auto components, data centers, defense, aerospace, and consumables it noted. The brokerage remains overweight on banks, diversified financials, healthcare, consumer, auto, and capital goods/defense as key themes.
"We believe renewed thrust on Defense, Data Centers, Infrastructure/Ports, High Speed Rail Corridors, Renewables and Manufacturing ecosystem bodes well for growth in coming years. Next 5-10 years will be driven by asset creation and technology intensive industries which will find favor with markets," said PL Capital.
PL Capital reports that third-quarter results beat estimates, but Nifty EPS forecasts were trimmed by 0.7-2.9 per cent for FY 26/27/28. Sales, Ebitda and PAT growth for its coverage universe were 9.9 per cent, 16.4 per cent, and 16.7 per cent year-on-year (YoY), respectively.
Key sectoral performers included auto, EMS, renewables, NBFCs, hospitals, cement, durables, telecom, logistics, and ports, all of which surpassed 15 per cent sales growth. Capital goods, consumer, metals, and pharma reported between 10-15 per cent sales growth.
On the profitability front, auto, building materials, capital goods, NBFCs, oil & gas, and telecom posted over 20 per cent Ebitda growth. Cement, logistics, EMS, and renewables achieved over 30 per cent EBITDA growth, while chemicals, media, education, and travel lagged.
There was a near balance in analyst rating changes, with 18 upgrades and 17 downgrades across industries. Capital goods and oil & gas had four upgrades each, while IT services had two. Oil & gas had three downgrades, and several other sectors saw two downgrades each.
Major rating upgrades included Hindustan Petroleum Corporation, Bharat Petroleum Corporation, JSW Steel, Cholamandalam Investment and Finance Company, Ingersoll Rand, Apar Industries, Tech Mahindra, Tata Elxsi, and Torrent Pharma. Downgraded companies included Shree Cement, Viniti Organics, Bajaj Electricals, Hindalco Industries, Oil and Natural Gas Corporation, OIL India, Mahanagar Gas, Lupin, Safari Industries, and Bharat Electronics.
PL Capital’s model portfolio remains overweight on banks, diversified financials, healthcare, consumer, auto, and capital goods/defence, while maintaining underweight positions in IT services and commodities. Allocations have increased to capital goods, NBFC, consumer, and metals, and reduced in auto and IT services.
PL Capital has added Torrent Pharma to the model portfolio. High conviction picks have been reshuffled, with HealthCare Global Enterprises, Ingersoll-Rand (India), and Ipca Laboratories have been included. It has removed HDFC Life Insurance Company, State Bank of India, Aster DM Healthcare, Fine Organic Industries and Max Healthcare Institute from the model portfolio.