MC Markets Poll: Most investors see valuations as reasonable; half expect IPOs to weigh on returns

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• Nifty expected to trade in 28,000–30,000 range by end of 2026, say experts
• 70% of experts find current valuations reasonable after recent corrections
• 51% believe heavy IPO supply could drag secondary market returns

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Indian market valuations are currently seen as reasonable, while the benchmark Nifty is expected to trade in the 28,000–30,000 range by the end of 2026, according to the latest Moneycontrol Market Poll. The survey covered nearly 60 market experts across broking firms, mutual funds, AIFs, PMS managers and independent experts.

About 70 percent of respondents said valuations are reasonable, while 4 percent described them as attractive. India’s benchmark Nifty is currently trading at about 20.5 times its one-year forward price-to-earnings multiple, compared with a 10-year average of around 19 times.

Axis Securities’ Rajesh Palviya said market valuations were “a little stretched” a few months ago but have turned more reasonable after price corrections across several stocks and sectors.

He added that earnings remain broadly in line with expectations and that consolidation over the next few quarters could help justify valuations. Palviya remains bullish on the Nifty and expects it could move to 27,500–28,100, followed by a stronger rally in 2026.

However, 26 percent of respondents said valuations still look expensive. Independent analyst Deepak Jasani said valuations, though off earlier highs, remain above their historical median and higher than competing markets, calling this a key headwind as earnings revival continues to be delayed.

On index expectations, 52 percent of poll participants see the Nifty ending 2026 in the 28,000–30,000 range. Another 31 percent expect it between 26,000 and 28,000, while 9 percent see levels above 30,000.

Nirav Karkera, Head of Research at Fisdom, said broader valuations are moving into fair ranges after time correction and downgrades, adding that several sectors may lay the foundation for an earnings revival. He expects the Nifty could move toward 29,000.

Meanwhile, 8 percent of respondents see the Nifty below 26,000 by end-2026. Jasani expects the index may rise in the first half and then correct or consolidate, potentially ending about 10 percent lower from current levels.

On cash allocation, 45 percent of respondents reported less than 5 percent cash in portfolios, 29 percent had 5–10 percent cash, and 26 percent had 10–20 percent. Palviya recommended maintaining 10–15 percent cash in portfolios, citing expected volatility and factors such as geopolitical tensions and uncertainty around tariffs. According to him, cash would allow investors to take advantage of opportunities during market swings.

A majority — 51 percent — believe heavy IPO supply could drag down secondary market returns. Jasani said IPO supply in 2026 may be lower than in 2025, as recent IPO returns have been weak and market momentum may fade in the second half.

Around 35 percent of participants disagreed, while 14 percent were undecided. Karkera expects market depth to improve, reducing any drag from IPO issuance. Palviya said strong domestic liquidity continues to support IPO demand and added that portfolio rebalancing may occur as investors shift allocations to new offerings.

On earnings expectations for FY27, 34 percent of respondents see Nifty earnings growth at 10–12 percent, 30 percent expect growth above 12 percent, 26 percent project 8–10 percent, and 10 percent expect 5–8 percent.

Karkera believes earnings across the broader market may grow in the mid-teens. Meanwhile Jasani expects Nifty FY27 EPS growth of 14–15 percent on a low base, noting that delayed consumption revival and low inflation are limiting profitability, while a modest rise in inflation could support stronger earnings.