MUMBAI: UBS sees the Nifty at 6,000 by March-end assuming coronavirus-related disruptions continue till September.
The target is about 31% below the indexs closing level of 8,748.75 on Wednesday.
6,000 assumes 14% decline in earnings in fiscal year 2021 and GDP also declining YoY in FY21, and a PE multiple of 12 times, thats what the downside scenario assumes, said Gautam Chhaochharia, head of India research at UBS in a conference call on Wednesday.
This target assumes disruption continues till September, and disruption does not mean full lockdown, said Chhaochharia.
In the base case scenario, the brokerage sees Nifty at 10,000 by March, assuming coronavirus-related disruptions end by June, and expects earnings growth of 2% for the Nifty in the ongoing financial year.
In the upside scenario, the brokerage has assumed a 5% earnings growth for Nifty constituents in FY21, with coronavirus-related disruptions ending by mid-May, which would see the Nifty ending the financial year at 11,500.