MONEY
Morgan Stanley’s revised target sees Sensex hitting 1,00,000 mark in a year
- IBJ Bureau
- May 22, 2025
In a new equity strategy note, Morgan Stanley has revised its base case target for the Sensex to 89,000 by June 2026. The global brokerage projects that the benchmark index of BSE could touch 1,00,000 in a bull case scenario, assigning a 30 per cent probability to that outcome.
“Our new Sensex June 2026 target of 89,000 (8 per cent upside) bakes in our new earnings estimates and is also rolled forward from the December 2025 target of 82,000,” Ridham Desai, Morgan Stanley’s chief equity strategist for India, has said. The new target implies a trailing P/E of 23.5x, higher than the 25-year average of 21x, a premium Mr Desai attributes to strong confidence in India’s medium-term growth cycle, low beta and policy predictability.
Morgan Stanley’s base case scenario (50 per cent probability) factors in robust domestic growth, a benign trade deal with the US, stable oil prices, a positive liquidity environment and a gradual 50-basis point cut in short-term interest rates. It also assumes continued support from retail investors, no major bunching of share issuances and a 16.8 per cent compound annual growth rate (CAGR) in Sensex earnings through FY28.
The bull case, where the Sensex hits 1 lakh within the next 12 months, rests on more aggressive assumptions: oil prices persistently below $65 per barrel, progress on farm reforms, GST rate cuts and CAGR of 19 per cent in corporate earnings. Relief from global trade tension would further fuel this scenario.
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