Earnings uncertainty, high valuations: Brokerages advise caution for 2025

Fundamentals strong but earnings growth uncertainty, elevated valuations seen capping upside

Indian equities are expected to deliver modest returns in 2025, as brokerages cite uncertainty around earnings growth and elevated valuations as major concerns even as India’s fundamental growth story remains promising. 

UBS on Tuesday warned of potential derating in the Indian market due to high valuations and the Reserve Bank of India’s limited ability to cut rates aggressively. Nomura also expressed similar concerns last week, stating that India’s market faces near-term risks of derating amid a slowing macro and earnings cycle. Domestic brokerage Kotak Securities on Tuesday set a modest Nifty target of 26,100 for December 2025, implying a 6