Investors Look Ahead to Samvat 2080 as India Prepares for 2024 General Elections
As Samvat 2080 approaches, analysts are predicting great promise for India’s future, despite global uncertainties such as rising bond yields and a war in the Middle East. The upcoming general elections in 2024 are the key factor contributing to this optimistic outlook, as many hope the outcome will drive up benchmark indices to new heights.
V K Vijayakumar, chief investment strategist at Geojit Financial Services, believes that the resilient Indian economy and good corporate earnings will attract significant investment into the market. He predicts a potential flood of institutional money, both domestic and foreign, if a stable government is put in place, which could trigger a big rally in the market, driving the Nifty beyond 23,000 the next Samvat.
Pranav Haridasan, MD & CEO of Axis Securities, also sees India in a favorable position for growth, which will drive Indian equities in the foreseeable future. He highlights the improvements in the balance sheet strength of corporate India and the health of the Indian banking system as positive attributes that will support double-digit returns in the next 2-3 years with double-digit earnings growth.
Reflecting on Samvat 2079, the previous year has been relatively positive for equity investors, with Nifty50 delivering 14.8% returns, outperforming the MSCI EM index. However, mid and small cap investors have even more to celebrate, with Nifty Midcap 100 index rising 22.7% and Nifty Smallcap 250 increasing 28% in the last year.
Looking ahead, analysts predict a possible election rally which will be led large companies. They foresee financials, capital goods, and automobiles as likely outperformers, while also backing banks, capital goods, manufacturing, and pharma sectors. However, they caution against companies based on urban consumption and commodities.
The looming uncertainty surrounding crude oil prices, which have been extremely volatile in recent weeks, and the ongoing Israel-Hamas conflict, both pose potential threats to Indian market valuations in the upcoming Samvat that will start on the day of Diwali.
Overall, there is an air of anticipation and optimism surrounding Samvat 2080 as India prepares for the next general elections, with analysts predicting investment opportunities, sector outperformers, and potential market rallies.