Citi Forecasts Nifty to Reach 26,000 by December, Upgrades India Market Outlook to ‘Overweight’

Mumbai: Global brokerage firm Citi has turned bullish on India, predicting that the Nifty 50 index could reach 26,000 by December 2025, representing a potential 15% upside from current levels. The positive outlook comes as Citi upgraded India’s market stance from ‘Neutral’ to ‘Overweight’, citing several favorable economic factors.

India’s Growth Potential Driving Positive Sentiment

In its latest research report, Citi emphasized that Indian equities present a significant upside potential, particularly due to attractive valuations and improving consumption trends. The brokerage firm has outlined three key factors driving its bullish stance on India:

1. Tax Cuts and Consumer Spending: The Union Budget for FY26 introduced recent tax cuts, which Citi believes will boost consumer spending and stimulate demand across various sectors.
2. Public Capital Expenditure Recovery: Citi highlighted the strong recovery in public capital expenditure, with infrastructure spending and government-backed growth initiatives showing promising signs for the Indian economy.
3. Monetary Policy Easing: Citi also expects further easing in monetary policy from the Reserve Bank of India (RBI). Following a 25 basis point rate cut by the RBI, Citi forecasts an additional 50 basis points cut in the near future, which would further stimulate economic activity.

India’s Domestic-Driven Economy Insulated from Global Uncertainties

Citi believes India’s economy, which is primarily driven by domestic consumption, is well-positioned to weather global economic uncertainties. With global concerns about US tariff policies and trade tensions, India’s limited exposure to trade with the US and China helps shield the country from the potential negative impacts of these policy changes.

Also Read: Sensex, Nifty End Lower by Over 1% Amid Weak Global Cues; IT Stocks Hit Hard

Despite ongoing pressures on India’s domestic benchmark indices, which have seen declines in recent trading sessions, Citi remains optimistic about India’s medium-term growth prospects. Over the past five sessions, Sensex has dropped 1,542 points (2%), while Nifty has fallen by 406 points (1.76%). However, Citi continues to foresee a strong recovery driven by the country’s domestic consumption and government spending.

Conclusion: A Bright Future Ahead for Indian Equities

With favorable fiscal policies and monetary easing, combined with the country’s domestic-driven economy, Citi’s outlook on India remains positive. The brokerage firm’s forecast suggests that the Nifty could reach 26,000 by December 2025, offering a potential 15% upside for investors.