Nifty 50 FY27 target: OmniScience sees 28,000-31,000

Earnings, not liquidity, as the core thesis

OmniScience Capital expects the next leg of India’s equity rally to be led by earnings delivery rather than liquidity-driven exuberance. In its FY2027 outlook, the firm projects the Nifty 50 could rise to a band of 28,000 to 31,000 by the end of March 2027. The range is built on FY27 earnings per share (EPS) estimates and an assumed forward valuation multiple. OmniScience argues the market is “significantly undervalued” even though headline valuations are close to long-term averages. It also frames any valuation re-rating as a potential upside scenario rather than a structural base case. The note was attributed to OmniScience Capital as the source, dated 2026-04-22.

Target range: how the numbers are framed

The firm pegs FY27 Nifty 50 EPS at about ₹1,280 to ₹1,320. It pairs this with a forward price-to-earnings (P/E) multiple range of 22 to 24. On that combination, it arrives at a projected index level of 28,000 to 31,000 by March 2027. OmniScience also states that, from current levels, the target implies about 15% to 25% upside over the next year. In its framing, the return expectations are broadly within historical bands, but the driver mix shifts toward earnings rather than excess liquidity.

Key assumptions: EPS, valuation, and implied upside

The core building blocks are explicitly numerical and tied to earnings expansion and potential multiple expansion. OmniScience expects Nifty’s earnings growth to be around 10% to 13% for FY27. It also notes that the re-rating argument is contingent, treated as an upside kicker rather than the central assumption. In other words, the target band includes a scenario where valuations improve as macro variables turn supportive. The firm’s messaging emphasises that long-term returns can still be attractive even with moderate earnings growth, provided investors can tolerate volatility.

Macro “kicker” that could support a re-rating

OmniScience lists several macro variables that could add support to equities beyond earnings growth. These include easing geopolitical tensions, softer crude prices, a stronger rupee, and moderating inflation. It suggests these conditions could allow the Reserve Bank of India (RBI) to keep interest rates steady. The firm also links this macro backdrop to the possibility of renewed foreign institutional investor (FII) inflows. However, it is clear that this re-rating case is not presented as guaranteed or structural. Instead, it is positioned as a favourable scenario that can lift outcomes from the base earnings-driven path.

Where valuations stand versus history

OmniScience flags that market valuations are near long-term averages. It cites Nifty trading at around 20x P/E and about 3.0x price-to-book (P/B) in its discussion on valuation positioning. In another snapshot, it mentions P/E around 21 and P/B around 3.3 as “close to long-term averages.” It also notes the market is below prior cycle peaks, which is part of its argument for better forward return potential than what higher-valuation regimes typically offer. Separately, it references a correction of about 13% from the September 2024 peak and states this magnitude does not qualify as a bear market under the common 20% drawdown definition.

Banks: balance sheet strength and capex tailwinds

On sector calls, OmniScience highlights banking as being in its best shape in a decade. It cites gross non-performing assets (GNPA) below 2.5%, capital to risk-weighted assets ratio (CRAR) around 17%, and provision coverage ratio (PCR) near 76.6%. According to the firm, this combination indicates robust balance sheets and positions banks to fund incremental credit of about ₹94 lakh crore without fresh equity. It also ties the outlook to a sustained government and corporate capex cycle, which it expects to support multi-year credit growth and earnings visibility. The sector is framed as one of the top long-term investment bets.

Power: energy transition and a large capex opportunity

OmniScience also identifies power as a structural, long-duration opportunity. It describes the sector entering an S-curve driven by renewables, storage, and green hydrogen. The firm estimates that by 2035, around 74% of installed capacity could be in these areas. It also points to an estimated ₹65 to ₹70 trillion capex opportunity backed by policy support. In addition, it highlights rising electricity demand, potentially tripling, and links that to newer sources of consumption such as electric vehicles and data centres. The broader point is that capacity expansion and the energy transition could create long-term earnings visibility across parts of the power value chain.

IT: cautious stance amid AI disruption and demand uncertainty

In contrast, OmniScience is cautious on IT, even after recent corrections. It says IT valuations remain fair-to-elevated relative to growth visibility and notes uncertainty around AI disruption and global tech spending. The firm suggests it may be prudent to wait for clearer demand trends and more attractive entry points before increasing exposure. Ashwini Shami, President and Chief Portfolio Manager, also flags limited medium-term (2 to 3 years) growth visibility due to uncertainty on how AI will affect Indian IT companies. The commentary distinguishes between long-term valuation comfort and near-to-medium term growth uncertainty.

Historical context: long-term returns and valuation buckets

OmniScience points to Nifty 50’s long-term performance over the last 25 years, citing about 14.26% CAGR including dividends. It characterises this as a sustained uptrend interrupted by sharp but relatively short-lived drawdowns. The report also discusses how forward returns vary by starting valuation, using P/B “buckets” as a reference. It says one-year returns show an inverse relationship with starting valuations, with outcomes compressing sharply as P/B rises and turning decisively negative beyond 5x P/B. For three-year and five-year periods, it notes the valuation impact moderates but does not disappear, and time can mitigate valuation risk as earnings compounding plays a larger role.

What investors may watch next

The OmniScience framework keeps the focus on earnings recovery and sector-level earnings visibility rather than a pure liquidity narrative. It also sets clear signposts for the upside scenario: geopolitics, crude, the rupee, and inflation trends that could influence rates and FII flows. As the firm itself notes, the re-rating case is contingent, not structural. For market participants, the near-term test will be whether earnings expansion tracks the stated 10% to 13% FY27 growth expectation and whether macro conditions align with the supportive scenario described.

Conclusion

OmniScience Capital’s FY27 Nifty call places earnings at the centre, with a 28,000 to 31,000 target band derived from ₹1,280 to ₹1,320 EPS and 22x to 24x forward P/E. Sector preferences lean toward banks and power, while IT remains a cautious call due to AI-led disruption risk and uncertain demand. The firm also flags macro factors that could provide a valuation “kicker,” but treats that as upside rather than the base case. Investors will likely track the pace of earnings delivery, policy and rate stability, and the macro variables highlighted as the market moves toward the March 2027 horizon.