ICICI Securities targets Nifty at 28,000 on resilient Indian corporate earnings

ICICI Securities has maintained a 12-month rolling target of 28,000 for the Nifty 50, alongside a 93,000 forecast for the Sensex. Head of research Pankaj Pandey based the projections on a 20 times price-to-earnings multiple for fiscal 2028, signaling confidence in the broader market despite recent consolidation.

The benchmark index is down roughly 0.60 percent in August, threatening to end a two-month winning streak. Investors remain cautious regarding elevated oil prices and the unresolved US-Iran conflict, which threaten inflation and monetary tightening. However, Pandey argues that stronger-than-expected corporate results provide a solid foundation for a sustained recovery.

First-quarter earnings for the Nifty 50 demonstrated notable resilience against a volatile macroeconomic backdrop. Topline growth reached a multi-quarter high of 18 percent year-on-year, while adjusted profit after tax expanded by 15 percent. Financial institutions led the advance with 19 percent profit growth, outpacing the 12 percent increase recorded by non-financial companies.

The recovery extends well beyond the primary index. Aggregate profit growth for all listed companies reached 16 percent, accelerating to 25 percent when excluding oil marketing firms. Pandey noted that removing both the Nifty 50 and oil marketers reveals a 35 percent surge, highlighting the substantial breadth of the current earnings cycle.

This marks the fourth consecutive quarter of double-digit profit expansion across the index. While Pandey anticipates some moderation in the second quarter due to lagged commodity price impacts, he sees no material risk to the broader trajectory. Forward estimates remain unchanged, projecting a 16 percent compound annual growth rate for Nifty earnings through fiscal 2028.

To capitalize on this environment, the brokerage recommended five equities for the coming year. Shriram Properties is positioned for strong pre-sales growth, targeting up to 3,500 crore rupees in fiscal 2027. The southern developer holds unsold inventory with a gross development value of 13,530 crore rupees across ongoing and upcoming projects.

Vedanta Aluminium is highlighted for its dominant 40 percent domestic market share and impending capacity expansions. The commissioning of new BALCO facilities and plant debottlenecking will push capacity toward 3 million tonnes per annum by fiscal 2028. Backward integration into alumina and captive mining is expected to lower input costs, supporting an attractive four times EV/EBITDA valuation.

SportKing India benefits from expanding cotton yarn spreads and lower procurement costs, which drove a 700 basis point margin expansion in the first quarter. Meanwhile, NRB Bearing is diversifying into aerospace and defense to support margin targets of up to 20 percent. The bearing manufacturer reported a 34 percent surge in its industrial segment, backed by a 1,100 crore rupee order book.

Lumax Auto Technologies rounds out the recommendations, leveraging its strong position in the passenger vehicle ancillary market. With passenger vehicles accounting for 53 percent of sales and top clients Mahindra and Bajaj Auto contributing 46 percent, the company is shifting toward higher-value content. Pandey expects this strategy, combined with low domestic car penetration, to drive continued industry outperformance.