Synopsis
Analysts said cheaper valuations have been on account of stronger-than-expected profit growth in the March and June quarters. In January-March, Sensex companies posted their highest-ever net profit numbers driven by higher commodity prices and strong consumer demand.
Mumbai: The near one-way rally in Indian stocks in the past 18 months has heightened concerns over rich valuations. But a silver lining for the market is that the valuation of the Sensex, the benchmark index comprising India’s 30 most valuable companies, at 60,000 is cheaper than what it was at 50,000.
An ET study shows the Sensex is trading at an estimated price to earning (PE) ratio – a popular valuation measure – of 25.8 times as against
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