Chennai, Jan 4 : The Nifty50 index is expected to touch 20,000 points in 2023, forecasts ICICI Securities Ltd in a report. Stagflation is the key risk to equities in CY23 wherein inflation picks up again post the waning of favourable base effects while growth decelerates, the report notes. In the report, ICICI Securities said: "Our Nifty50 target for CY23-end stands at 20,000 implying 11 per cent upside, which is sub-par considering the long-term expected return of at least 12 per cent from Indian equities." According to the report, themes related to corporate and government capex, real estate cycle, credit growth and pockets of discretionary consumption to outperform in CY23. "US big tech selling is likely to end driven by the US Fed pivot and earnings yield approaching five per cent, which will have its rub-off effect on India IT and digital themes," it notes. According to ICICI Securities, the key factors that will likely to drive equity valuations in CY23 are: With rising probability of a mild recession in the US and long-term inflation expectations dropping towards the two per cent mark, the US Federal Reserve could pivot away from its current hawkish stance in CY23; Domestic demand to be driven by the recovery seen so far in corporate and government capex, credit growth, real estate cycle and policy initiatives towards boosting manufacturing industry; Pockets of demand emerging within discretionary consumption driven by the growth in aggregate corporate sector wage bill which is outpacing nominal GDP growth due to the formalization of the economy. Other triggers for formal sector wage growth include pick up in the investment cycle and policy focus on boosting manufacturing and High optimism has evaporated around big tech, IT and digital themes even though their long-term fundamentals remains intact. Selling in US abig tech' could end in CY23 as the Nasdaq100 index's earnings yield approaches about five per cent compared to the US bond yield of 3.8 per cent and likely US Fed pivot, which could have its rub-off effect on Indian IT and digital themes. /IANS