Markets fall despite government’s fresh stimulus package, Goldman upgrade

By: |
November 13, 2020 5:30 AM

Analysts at Goldman Sachs said in a report they were raising India to ‘overweight’. They expect corporate profits to rebound 27% next year and a further 21% in 2022, after an expected decline of 11% this year.

The brokerage said the investment case for India has improved.

Shrugging off the government’s fresh stimulus package as also an upgrade by Goldman Sachs, the Sensex and Nifty on Thursday reversed their eight-session winning streak.

Analysts at Goldman Sachs said in a report they were raising India to ‘overweight’. They expect corporate profits to rebound 27% next year and a further 21% in 2022, after an expected decline of 11% this year.

“While valuations remain extended and could see some pressure, we expect further market gains driven by earnings recovery and expect NIFTY to reach 14100 by end 2021 which implies 15% upside from current levels,” they wrote.

The brokerage said the investment case for India has improved.

“First, India has been a laggard this year underperforming the region by 11 pp in USD terms. As we noted in our recent report, Indian equities are most positively sensitive to the improving prospects of a vaccine, and so we expect a ‘catch up’ laggard rally given the positive news flow on the vaccine front (which could spur faster than expected recovery). More importantly, on the fundamental side, the domestic macro recovery is underway as suggested by pick up in high frequency activity data points”, the analysts said.

GS economists expect real GDP growth to rebound to 10% and 7.2% over the next two years versus an expected -9% this calendar year.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Booster shot: Markets on a high; Nifty crosses 13,000 amid high hopes of Covid-19 vaccine soon
2Nifty crosses 13,000 mark as all benchmarks hit all-time high records
3Dow Jones hits 30,000 as Wall Street bets on 2021 bounce