Diwali 2023: What should be your investment strategy in Samvat 2080? Here's what experts recommend

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Read here: SBI, L&T and more: ICICI Direct lists 7 stocks to buy this Diwali With a positive outlook ahead, what strategy should you follow in the next year? Here's what experts recommend. Despite global uncertainties, India remains a shining star and is expected to maintain its outperformance.

Nifty is trading at a 12-month forward P/E of 17.6x, which is at a 13 percent discount to its 10-year average, thus providing comfort. We believe that over the next couple of quarters, sector rotation could be an important driver along with the overall market uptrend.

We also believe valuations will become an important factor in stock selection to drive outperformance in portfolios. The 3Es - Economy, Elections, Earnings, and geopolitical crisis outcomes over the next few quarters would drive the return for the next Samvat year, 2080.

We believe every decline in the market is likely to present a good opportunity as strong earnings rollover to FY26E will make the markets more attractive compared to the long-term averages, setting the goal post for NIFTY50 to scale to 22000+ over the next one year (19.5 times one year forward). Healthy momentum in corporate earnings, strong retail participation, all-time high SIP flows, and relative underperformance of largecaps in the last few months pave the way for superior returns in largecaps v/s midcaps.

NIFTY50 earnings are estimated to clock a decent 9 percent CAGR over FY24-FY26E based on consensus Bloomberg estimates and NIFTY50 is trading at 17.2 times one year forward well below the long-term 10-year averages which provides comfort at current valuations and limited downside despite the key events. We continue to favour domestic-oriented businesses and favour opportunities in the sectors