Goldman Sees Earnings Upgrade Cycle in India's AI Trade Amid Broader Market Decline
Goldman Sachs analysts have observed a significant earnings upgrade cycle in India's AI trade, despite Nifty estimates being cut by 2%. The bank's research indicates that calendar year (CY) 2027 earnings-per-share estimates for its 42-company basket of Indian 'AI Enablers' have risen 22% so far this year. This is a stark contrast to the broader Nifty 500, which has seen CY27 EPS estimates fall by 2%. Data-centre hardware has led the upgrades, with estimates rising 95%, followed by power equipment at 15% and semiconductor materials at 8%.
The earnings divergence comes after a striking gap in stock-market performance. Goldman's AI Enabler basket has gained around 60% in 2026, while the Nifty has fallen approximately 12%. The bank describes the cohort as the strongest-performing pocket of the Indian market this year, with healthcare being the next best-performing segment.
Goldman notes that the rally has not been driven solely by investors paying higher valuations for anything associated with AI. Since 2025, the AI Enablers have returned 53%, with earnings growth contributing 65 percentage points to returns while valuation compression detracted 12 percentage points.