The 6.5-7 percent is doable for FY23. FY24 growth will depend a lot on how recession or slower growth shapes up in US / developed world. A lot of probabilities out here.
The future trajectory of FII flow, to a large extent, depends on the inflation in US and in India. Higher interest rates in the US typically lead to flows moving to the world#39;s largest economy, resulting in the strengthening of the US dollar at the cost of emerging markets like India.
Markets are trading at slight premium to long term averages on FY24 consensus earnings. Hence it should consolidate at current levels before resuming the uptrend.
Except for resource companies, i.e. producers of commodities and crude oil, most of the other sectors should report strong revenue and earnings growth over the next several years. Demand is likely to remain strong in the near to long-term for Indian companies.
We believe a lot of companies in the small and mid-cap space are ready to outperform, given that they’ve completed or are close to completing their capacity expansions, are sitting on lean balance sheets, generating healthy cash flows and are trading at reasonable valuations post the correction. We believe a lot of companies in the small and mid-cap space are ready to outperform, given that they’ve completed or are close to completing their capacity expansions, are sitting on lean balance sheets, generating healthy cash flows and are trading at reasonable valuations post the correction. We believe a lot of companies in the small and mid-cap space are ready to outperform, given that they’ve completed or are close to completing their capacity expansions, are sitting on lean balance sheets, generating healthy cash flows and are trading at reasonable valuations post the correction.
The pharmaceuticals sector has witnessed a sharp correction and quality stocks in the sector are available at compelling valuations.
Markets work on expectations, and with commodity prices cooling off and global inflation contracting, equity investors are buying on the expectation of an economic recovery.