Fairness markets witnessed a robust rally in 2021 with Nifty up round 22% whereas Nifty Midcap 100 and Nifty Smallcap 100 sharply outperformed with features of round 43% and 53% respectively. Decline in covid circumstances, a major pickup within the tempo of vaccination, and the resultant sharp restoration in financial exercise, persistently constructive earnings surprises additionally led to rerating and rally available in the market.
Going forward within the new yr, brokerage home Motilal Oswal stays optimistic and expects Nifty to ship round 12-15% returns in 2022, supported by continuation of the financial restoration and robust earnings progress.
“After the latest correction, Nifty is now buying and selling at ~20x 12 month ahead PE which is not within the costly zone. Whereas the market pattern is likely to be unstable within the close to time period on account of potential threat from Omicron variant and fragile international cues, in the long term, robust earnings supply together with constructive macro-economic knowledge would maintain the important thing to drive markets upwards,” it stated in a word.
The brokerage agency has advisable prime inventory picks within the midcaps house for the yr upcoming yr 2022 that one can look to purchase, which incorporates Angel One, Macrotech Builders, Ramco Cement, Zensar Tech and Devyani Worldwide.
Motilal expects sectors akin to IT, Telecom, Capital Items, Cement and Actual Property to do effectively in 2022. Whereas Banking and Auto which have underperformed the market thus far – have the potential to prove the darkish horse in 2022.
“We count on the robust progress momentum to proceed as we’re at first of a brand new earnings cycle and count on Nifty EPS to develop at 35%/19% for FY22/FY23 to INR730/INR873, after delivering 15% progress in FY21,” the brokerage word added.
The views and suggestions made above are these of particular person analysts or broking corporations, and never of Mint.
Supply: Live Mint