Nomura Cuts December 2026 Nifty Target By 15% To 24,900 Amid Rising Oil Prices

Japanese brokerage firm Nomura Holdings has slashed its target for the Nifty 50 index in December 2026 by 15% to 24,900.

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The revised target is lower than the earlier projection of 29,300 for the index, according to a research note by Saion Mukherjee, head of India equity research at Nomura. The brokerage said the updated target still implies an upside of nearly 7% from the current Nifty levels.

Nomura also said consensus earnings estimates for FY27 could face a risk of 10–15% if crude oil prices remain elevated for a prolonged period.

Market Correction In Recent Weeks

Indian equity markets have declined sharply over the past two weeks. The Nifty 50 index has fallen about 8% during this period, according to exchange data.

Nomura noted that a correction of this magnitude has occurred only twice in the past decade. One instance was during the COVID-19 pandemic market crash 2020, while the other followed the outbreak of the Russia-Ukraine war 2022.

The brokerage said market valuations measured through price-to-earnings ratios and spreads over bond yields are currently near the lower end of the valuation range seen during the past four years.

Nomura’s base-case scenario assumes a 7.5% reduction in consensus earnings estimates and a price-to-earnings multiple of 18.5x compared with its earlier estimate of 21x.

Oil Price Surge Raises Concerns

According to Nomura, the revision in its market outlook is linked to the sharp increase in global crude oil prices, which have crossed $100 per barrel following disruptions around the Strait of Hormuz, a key global oil transit route.

The brokerage noted that the Strait of Hormuz accounts for around 20–25% of global trade in crude oil and liquefied natural gas.

For India, the dependence on the route is significantly higher. Around 43% of the country’s crude oil imports and about 63% of its liquefied natural gas imports pass through the Strait of Hormuz, according to the Nomura report.

Nomura said the current geopolitical situation could have a larger impact on global energy markets compared with the Russia-Ukraine conflict, during which Russian supplies continued to reach markets despite sanctions.

Impact On Corporate Earnings

Nomura stated that supply disruptions and higher oil prices may affect industrial production because several manufacturing industries depend on oil and gas supply chains.

The brokerage estimated that crude oil prices up to $90 per barrel may largely be absorbed by oil companies and the government. Any additional increase beyond that level could lead to higher fuel prices for consumers.

Nomura also noted that continued volatility in energy markets could influence inflation levels and external balances in oil-importing countries such as India.