New Delhi, Aug 3 (IANS) India’s equity markets have shown sustained resilience amid global macroeconomic and geopolitical volatility and commodity price swings, with the country’s long‑term structural growth story remaining intact, a report said on Monday.
The report from PL Asset Management said inflation remains low, monetary policy accommodative, corporate earnings visibility improves and government capital expenditure continues to support activity, collectively making the overall investment climate favourable for Indian equities.
The report noted that much of the economic uncertainty has already been priced into the markets.
“Favourable demographics, rising domestic consumption, increasing manufacturing activity, infrastructure spending, digitalisation, and the formalisation of the economy will continue to drive corporate earnings in the future,” it forecasted.
While risks such as rising crude oil prices, currency fluctuations, and geopolitical developments need to be monitored, the firm believes these factors are unlikely to derail India’s economic growth over the long term.
The firm advised investors to maintain a long‑term perspective and use market consolidation as an opportunity to build positions in quality companies with strong fundamentals, while remaining diversified across industries and market capitalisations.
“It would be a mistake to try to time the market; instead, investors should use volatile situations to increase their exposure to well‑managed businesses,” said Sandeep Neema, Director & Fund Manager, PL Asset Management.
“However, there are still some strong investment ideas in the spaces of financials, industrials, energy and power, and metals, where the earnings growth is expected to be driven by policy measures, infrastructure expenditure, and the capital expenditure cycle,” he suggested.
The firm also identified opportunities “in some small and mid-caps with solid business models and clear visibility on the earnings front.” It remained “quite conservative on the IT sector overall owing to falling global demand and changing disruptions on the back of artificial intelligence”.
—IANS
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