Markets are overvalued; IT, metals among most expensive sectors: Analysts

As of Jan 2024, the price-to-book valuation for the Nifty50 index, according to HDFC Securities Institutional Research, was 114 per cent of the average historical valuation, indicating expensiveness.

Indian equity markets, be it the Nifty50, Nifty Midcap 100 and Nifty Small-Cap 100, are overvalued at the current levels and are trading much higher than their respective historical valuations, suggest analysts.

As of January 2024, the latest price-to-book valuation for the Nifty50 index, according to Varun Lohchab and Amit Kumar of HDFC Securities Institutional Research, was 114 per cent of the average historical valuation, indicating expensiveness. Previously when this ratio crossed 100 and touched 103 per cent in FY22, the index declined by 1.8 per cent in the subsequent financial year, FY23.

“The Nifty Midcap 100 is currently trading