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Kotak Institutional Equities’ CEO and co-head Pratik Gupta foresees a modest earnings growth for 2026, cautioning with a downside risk from global as well as domestic factors.

“At Kotak, we are penciling in about 12 percent earnings growth in FY26, followed by another 14 percent in FY27.” Gupta said in conversation with CNBC TV18 on April 28. This growth could slow to 9-10 percent, he added, aligning with the nominal GDP growth.

Gupta said he is weary of a poor June quarter and foresees September or December to bring in QoQ and YoY earnings improvements. This recovery is likely to be supported by better liquidity, a stable rupee, lower oil prices and a normal monsoon, he added.

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Gupta added that India has become an attractive market for global capital, with some outflows from the US starting to finding its way into the market. “There is increasing interest from asset allocators to investing in emerging market funds, number of enquiries has gone up, passive funds have seen big flows come into EMs and India is benefitting," he said, adding that India is a preferred economy irrespective of cheaper valuation in competing markets such as China.

The ongoing tensions between India and Pakistan, as a fallout of the Pahalgam terror attack remain an area of concern, Gupta said, but how these dynamics develop is unclear, adding an element of risk to the overall outlook.

On the Indo-US trade talks, Gupta said that while has been some progress, the outcome remains unclear as to how it will impact India’s trade dynamics in the longer term. He said aspects like farm products and retail are tough to agree on.

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Kotak Institutional added that a pickup in Centre’s capital expenditure cycle can be expected, providing an additional boost to economic growth. Gupta added that he is not too bullish on the market, and is cautious on valuation. “10 -15 days back we were beginning to get into slightly attractive territory, and the way the rally has happened in the last 10 days, we've moved to the most expensive side, so we are back to being somewhat cautious again.”

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.​​​

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