Overview
- Morgan Stanley’s base case pegs the Sensex at 95,000 by December 2026 (about 13% upside) and its bull case at 107,000 with earnings growth projected at 17%–19% CAGR through FY28.
- The outlook assumes a further 25 bps rate cut, easier liquidity and possible GST rationalisation alongside fiscal consolidation, private capex and steady global conditions.
- Recommended positioning tilts overweight to domestic cyclicals—Financials, Consumer Discretionary and Industrials—and underweight Energy, Materials, Utilities and Healthcare.
- The firm highlights foreign portfolio investor exposure as the lightest on record and resilient domestic flows, arguing this setup leaves room for fresh inflows and a re-rating.
- Risks include oil above $100 a barrel, RBI tightening and a deeper global slowdown, with a bear case near 76,000, as markets pause their advance with Nifty support watched around 25,700–25,800 after a six-day rally snapped.