Indian equities trading at fair valuations relative to global peers: Report
Mumbai: India is at the cusp of a new investment upcycle and domestic equities are currently trading at fair valuations relative to global peers, a new report showed on Wednesday.
Nifty 50 is at approximately 20 time P/E (Price-to-Earnings) — below its recent historical averages. The valuation comfort is supported by robust macroeconomic fundamentals, including expected GDP growth of 7.3–7.5 per cent and steady earnings expansion, according to the report by Emkay Global Financial Services.
“India is at the cusp of a new investment upcycle, driven by healthier corporate balance sheets, policy support, and a more pragmatic approach from promoters. There is a clear pivot towards sectors like manufacturing, infrastructure, and energy, where rising capex and global realignment are creating long-term opportunities,” said Yatin Singh, CEO, Investment Banking, Emkay Global Financial Services.
After a significant correction, the Nifty 50 is currently trading at approximately 20.23 times TTM (trailing twelve months) P/E — well below its 1-year median of 22.30x and 10-year median of 23.50x.
This places India at a reasonable valuation relative to global peers such as NASDAQ (33.23x), Nikkei225 (22.14x), and DAX (16.49x), the report mentioned.
India’s valuation premium relative to emerging markets is underpinned by strong structural fundamentals.
The economy is expected to grow at 7.3–7.5 per cent in FY26 (as per Fitch, MOSPI and consensus estimates), while Nifty earnings are projected to deliver a low-to-mid-teens CAGR over FY26–FY28.
This growth visibility is further reinforced by political and policy stability, which enhances investment predictability, along with robust domestic capital flows through SIPs, EPFO, and insurance channels.
India is entering a new, long-duration investment cycle led by three mutually reinforcing sectors like manufacturing, infrastructure, and energy.
It highlights that the three sectors together are expected to define India’s next decade of investment-led growth, offering scale, visibility, and compounding opportunities for long-term capital.
“Promoters today are more open to partnering with institutional capital to accelerate growth and build scale. With capital available but increasingly selective, businesses with strong governance and execution capabilities will stand out. We see this as a defining phase for sustained, investment-led growth in India,” said Singh.