Markets and returns - Future Updated View

 The earlier post in Sep 2019 is here

https://personalfinfitness.blogspot.com/2019/09/markets-and-returns-future.html

When this article was posted Sensex and nifty corrected around 11.5% from peak and nifty index was around 11k and sensex was around 36k.  That time the five years view was we are anywhere in midpoint and market would double from there that is sensex would be anywhere around 75k and nifty around 22k.

I also mentioned in the previous article that 2002 to 2008 is the golden period because nifty saw a 700% return in 5 years. Are we going to see the same again, i still doubt. But my view on nifty has changed based on some recent analysis.

From Sep 2019 we are already 2 years and its good to have update on my view based on current market conditions. In the next 5 years i am still bullish on the market and have arrive a figure of nifty hitting 36k.

After 5 years psychologicall people will forget the previous peak of 12450 and will say 2020 market was in 7500 and now its 36k which is close to 500 percent returns.

How to we arrive at a number like 36k.  We might still live in a low corporate tax regime. You can do some work by listing all nifty companies, extrapolate their earnings, profits, growth and arrive at a EPS for next 4 to 5 years and arrive at average EPS of nifty year on year and also have a reasonable forward PE and can calculate where approximately nifty can be. You can include few companies from nifty next 50 which may have a possibility to come to nifty 50 as well.  

Anyways this is just approximation and you can decide how bullish you can be. Even in a ultra bull market, corrections of 5, 10,15 or even 20 percent is going to stay. Lets us hope the low corporate tax is going to stay as well.