Indian Equities Set for Exciting 2026, Double-Digit Earnings by FY27: Kotak's Nilesh Shah

• Nilesh Shah of Kotak Mahindra AMC predicts 2026 will be an exciting year for Indian equities, with earnings likely rebounding to double-digits in FY27.
• FII flows are expected to return in 2026 due to easing global rate cycles, softening US growth, and doubts about overhyped AI trades.
• Investors should focus on sectors with structural tailwinds: financials, consumer discretionary, capital goods & infrastructure, IT, defence, and chemicals.
• The rupee is expected to stabilize with low single-digit annual depreciation, supported by large forex reserves and a manageable balance of payment gap.
• While 100% FDI in insurance is positive, significant foreign investments will take time to materialize; no major new fiscal stimulus is anticipated in Union Budget 2026.

Why It Matters: Indian equities poised for strong performance in 2026, driven by earnings rebound and FII return.