Citigroup cuts Sensex December 2015 target to 32,200
Citi has also introduced a June 2016 target of 35,000, saying that investors' faith in India is currently a little fickle
Mumbai: Citigroup has cut its December 2015 target for the Sensex to 32,200 points on Thursday from 33,000 earlier, and introduced a June 2016 target of 35,000, saying that investors’ faith in India is currently a little fickle.
At 12:55pm, the 30-share BSE Sensex was trading 0.25% lower at 27,766.79 points, while National Stock Exchange’s 50-share Nifty was down 0.26% at 8,401.45 points.
“We see 2015 is turning out to be very different from 2014 for India investors. It is materially underperforming peers, has disappointed on both its growth trajectory and that of earnings, has seen some days of outflows, and is feeling very over-owned," Citigroup analysts Aditya Narain and Jitender Tokas said in a combined note.
So far in 2015, while Sensex is up a mere 1%, its peers China’s Shanghai Composite Index, Brazil’s Bovespa, and Russia RTS Index have logged gains of 40.03%, 9.79% and 30.99%, respectively.
There is a perception that the government has got a little logjammed in Parliament and that is testing the faith of investors who have until now liked India for its quality, transparency and macro direction, among other things, Citigroup analysts pointed out in the note.
Citigroup said it sees five fundamental issues that will test investors’ faith further: growth/quality, interest rates/valuations, real/nominal numbers of inflation, foreign/domestic flows, and government promise/performance.
“We would keep the faith: stay positive," they added.
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