Nomura Warns of Earnings Cuts, Capex Delays as High Oil Prices Persist

• Nomura's Saion Mukherjee warns of a potential 5-7% market downside before a durable recovery, lowering Nifty year-end target to 24,900.
• The brokerage anticipates a mid-to-high single-digit earnings cut due to sustained crude oil prices at $90-$95, impacting inflation and corporate profitability.
• Geopolitical uncertainties are expected to delay private capital expenditure recovery, leading Nomura to favor IT services, pharmaceuticals, and select manufacturing sectors.
• Aurodeep Nandi, Nomura's India Economist, trimmed India's FY27 real GDP growth estimate to 7% and raised inflation forecasts.
• RBI is expected to hold rates for now due to the supply-side nature of the shock, but a sharper rise in crude prices could complicate policy.