Can Nifty hit 30,000 by next Diwali? Insights from Anil Singhvi & Manish Sonthalia

As the festive season approaches, investors are keen to know the market outlook for the next year.

In a recent discussion with market veteran Anil Singhvi, Manish Sonthalia, Director and Chief Investment Officer at Emkay Investment Managers, shared his insights on where Nifty could be headed by next Diwali.

Can Nifty Hit 30,000 by Next Diwali?

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According to Sonthalia, Nifty is unlikely to fall below 25,000 this Diwali. Looking ahead to next year, he expects the index to reach between 29,000 and 30,000.

He notes that the market has already priced in several negative factors, yet it continues to hold strong above key support levels. This suggests that there is considerable upside potential over the next 12 months.

Based on his assessment, investors could expect approximately 20% gains if current trends continue.

Factors Affecting Nifty

Sonthalia highlighted several factors supporting this bullish view. Firstly, India remains an underperformer compared to other emerging markets, where indices have risen 25–40% in the past year.

This underperformance has already been largely factored in, suggesting limited downside.

Secondly, volatility levels remain moderate, with India’s VIX at around 10 to 11, indicating that panic selling is unlikely.

Additionally, the rupee is currently undervalued, and any moderate appreciation could provide a tailwind to the markets.

Earnings growth also supports a positive outlook. Due to GST reforms and other policy changes, corporate earnings estimates for the next two years have been revised upward to around 11%, providing a strong fundamental base.

Sonthalia explained that India’s valuations are not excessive compared to global markets, and despite concerns, there is room for growth.

Sectoral Trends: Top Leaders

Sectoral trends indicate that the BFSI (Banking, Financial Services, and Insurance) space could lead the market. Recent monetary policy measures have encouraged corporate and retail lending, benefiting both public and private sector banks.

Insurance companies are expected to gain from improved penetration levels and better profitability due to policy reforms.

Consumption is another area likely to see a boost, driven by government initiatives and festive demand.

Overall, these sectors form heavyweights in Nifty and could drive significant gains.

FII Trading Activity

Sonthalia also addressed concerns over continued selling by foreign institutional investors (FIIs). He explained that FII activity has been influenced by factors such as rupee depreciation and tariffs.

However, domestic institutions are active buyers, and any short covering by FIIs could further push the market upward. He emphasised that current market conditions, including low oil prices and an undervalued rupee, are supportive of growth.