Brokerage firm Citi Research expects India's benchmark Nifty 50 index to reach 28,000 points by end-2027, citing a strong earnings outlook, lower oil prices and the prospect of slower AI spending as tailwinds for equities. The call, in a Citi India equity strategy note dated 8 November and reported on 9 November, comes after the Nifty surged more than 10 percent over seven sessions through Friday.
What Citi expects
Citi raised its price-to-earnings multiple for the Nifty 50 to 18 times, from 17 times, which led to the target of 28,000 points. The higher multiple reflects Citi's view that Indian shares deserve a higher valuation, given the earnings outlook and the fall in oil prices. The brokerage said Indian equities have lagged global peers until recently, as enthusiasm around the AI trade and elevated crude oil prices weighed on the outlook for the world's third-largest oil importer. That has now changed, with oil prices easing and the AI trade unwinding. Citi's call comes after the benchmark Nifty 50 surged more than 10 percent over the seven sessions through Friday, helped by a return of foreign portfolio investors as AI-linked trades unwound and oil prices retreated. The rally has taken the Nifty back above 25,000.
Foreign money is returning
Foreign portfolio investors have bought Indian shares worth over $4.1 billion so far in November, already their biggest monthly inflows since September 2024. The buying has been a key driver of the rally, and Citi expects it to continue. Citi said a 100-basis-point increase in the active weight that global investors give to India could drive about $12 billion of inflows. That is the scale of money that could come in if India becomes a bigger part of global portfolios, and it would support the market for months. India was the top recipient of foreign equity inflows among emerging markets in the first week of November, according to market data. The inflows were far higher than those into other emerging markets, with Dubai, the second-highest recipient, attracting only $165 million.
A note of caution
Not everyone is convinced the inflows will last. Madan Sabnavis, chief economist at Bank of Baroda, said one week is too short a period to judge a pattern, and that firm conclusions can only be drawn if inflows sustain for the next few months. The caution is fair. Foreign investors have sold Indian shares heavily at times in the past two years, and a single week of buying does not guarantee a lasting turn. The market will need to see the inflows continue, and earnings stay strong, for Citi's target to be reached. The near-term direction will also depend on crude oil prices, which affect both inflation and the trade deficit, and on whether the AI trade continues to unwind. If oil rises again or global tech stocks recover sharply, some of the money that came into India could flow back out.
What it means for investors
A Nifty target of 28,000 by end-2027 implies a rise of about 12 percent from current levels, spread over more than a year. That is a steady gain, not a sharp rally, and it rests on earnings growing as Citi expects. For investors, the call is a sign that at least one large global brokerage sees value in Indian shares after the recent rally. It is not a guarantee. Brokerage targets are forecasts, and they change as earnings, oil prices and global markets move. The 28,000 target should be read as Citi's view of where the market could go, not as a promise.
