Kotak Securities, in its Market Outlook 2026, presents a confident view on Indian equities even as global markets remain unsettled. The brokerage notes that after a sharp 17% drawdown from the September 2024 peak, the Nifty staged a strong recovery and ended 2025 at fresh all-time highs.
Shripal Shah, MD & CEO of Kotak Securities, said that India continues to stand out as a beacon of growth. According to Kotak Securities, steady corporate earnings and strong domestic investor participation helped absorb persistent foreign selling, keeping the broader market on firm ground. The brokerage adds that this domestic support has become a key pillar of market stability.
The 32,000 Roadmap: Deciphering the Nifty Targets
Kotak Securities’ 2026 outlook is anchored in earnings visibility. The brokerage projects Nifty profits to grow by 17.6% in FY27E and 14.8% in FY28E, forming the basis for its index expectations.
For December 2026, Kotak Securities outlines three scenarios. In its bull case, the brokerage sees the Nifty reaching 32,032, assuming a valuation multiple of 22 times earnings. The base case, described by Kotak Securities as the most probable outcome, places the index at 29,120, based on a 20 times multiple applied to FY28 estimated earnings of Rs 1,456. In a downside scenario, Kotak Securities sees the Nifty 50 at 26,208, assuming an 18 times multiple.
According to the brokerage, these projections rest on earnings delivery and continued participation from domestic investors.
Kotak Securities’ 2026 outlook: The ‘Preferred Four’ sectors
Kotak Securities notes that the previous phase of the market was led by automobiles, banks, and metals, while mid-cap and small-cap stocks lagged. Looking ahead to CY26, the brokerage identifies four sectors it believes are positioned to drive the next leg of growth.
BFSI (Banking, Financial Services, and Insurance)
Kotak Securities places BFSI at the centre of its 2026 market view. The brokerage points out that banks were among the few sectors that outperformed even during the 17% market drawdown after September 2024. This resilience, according to Kotak Securities, strengthens BFSI’s role as a stabilising force.
For CY26, Kotak Securities names BFSI as a top preferred sector and links it directly to the projected 17.6% growth in Nifty profits for FY27E. The brokerage sees BFSI as critical to supporting its base case Nifty target of 29,120.
Technology
Kotak Securities includes Technology among its preferred sectors for 2026 after a prolonged weak phase. The brokerage notes that while sectors such as automobiles and Metals led earlier gains, IT stocks remained under pressure for much of the cycle.
In its 2026 outlook, Kotak Securities signals confidence in the stabilisation of Large cap technology names. The brokerage views this phase as part of an optimistic stage for the market, where technology begins to add to earnings momentum alongside steady investor participation.
Healthcare
Healthcare is identified by Kotak Securities as an important allocation for CY26. The brokerage links the sector’s inclusion to its broader view of India continuing to perform steadily amid global uncertainty.
Kotak Securities expects healthcare to benefit from consistent earnings visibility and deeper market engagement. Its presence among the preferred sectors aligns with the brokerage’s expectation of the Nifty achieving FY28 estimated earnings of Rs 1,456 through multiple contributors rather than dependence on a single sector.
Hospitality
Kotak Securities also names Hospitality as a preferred sector for 2026, pointing to strength in domestic consumption and services-led activity. The brokerage sees the sector as a beneficiary of rising participation from younger investors and improving market sentiment.
As domestic investors continue to cushion foreign selling, Kotak Securities views hospitality as well placed to gain from expanding consumption trends and long-term growth potential.
The ‘Sparkle’ Strategy: Kotak Securities on Gold, Silver, and Metals
Kotak Securities’ outlook also covers commodities, which the brokerage sees continuing to play a role in asset allocation. The brokerage highlights gold’s strong performance in 2025, when prices crossed $4,000 per ounce. In India, Kotak Securities notes that gold prices rose nearly 60%, supported by currency movement.
According to Kotak Securities, gold remains an important store of value in 2026. Silver, meanwhile, delivered gains of about 100% in the previous year, driven by supply constraints and demand for safety. Kotak Securities also expects base metals such as copper and aluminium to remain supported, aided by supply tightness and demand linked to electrification.
The Retail Participation Gap: Kotak Securities Flags Untapped Potential
Kotak Securities draws attention to a wide gap in household participation in equity markets. Citing SEBI data, the brokerage notes that while 63% of households are aware of securities market products, only 9.5% actively invest.
Kotak Securities views this gap as a major long-term opportunity. With domestic investors continuing to support markets during periods of global stress, the brokerage expects rising participation, particularly from younger investors, to deepen engagement and support wealth creation over time.
Kotak Securities’ 2026 outlook
Kotak Securities frames the Indian market in 2026 as one supported by a strong domestic base and improving earnings visibility. With projected profit growth of over 17% and clearly defined sector preferences, the brokerage believes the foundation is in place for the Nifty to work toward its higher targets.
As Kotak Securities presents it, the coming year will be shaped by earnings discipline, domestic participation, and selective sector leadership rather than broad-based speculation.