As of the end of October, the World Federation of Exchanges, the global association overseeing stock exchanges and central counterparties, reported that the combined market capitalization of domestically listed companies in India stands at $3.7 trillion USD. This figure is almost on par with Hong Kong’s $3.9 trillion USD.
Abhiram Eleswarapu, the Head of Indian Equities at BNP Paribas in Hong Kong, noted that over the past decade, Indian stock indices have witnessed “significant fluctuations.” This pattern is a part of the broader narrative surrounding emerging markets.
Furthermore, the expert indicated that the robust consumer spending in India is attracting investors. Affluent individuals in India are increasing their expenditures on real estate, luxury goods, and high-end items. Additionally, there is a growing trend of government spending on infrastructure.
As per the International Monetary Fund (IMF), India is expected to have the swiftest-growing economy worldwide in 2023, with a projected growth rate of 6.3% for this year.
Pratik Gupta, CEO, and Co-Founder at Kotak Securities in Mumbai, stated, “Looking across the globe, you will find not many countries sustain a steady GDP growth of around 6% for the next 15-20 years.”
CEO Gupta noted that Indian enterprises are persistently reducing their debt, a trend that has been unfolding for several years. They have been settling their debts and issuing equity capital, a pattern that has gained momentum during the pandemic. In November, Tata Technologies, a subsidiary of the Tata Group, made a remarkable entry into the market, raising $365 million in its initial public offering (IPO).
At the same time, numerous international companies are actively seeking opportunities to grow their production bases in India. For example, Tesla has been in talks with Indian government officials to explore the potential establishment of a manufacturing facility in the country for electric vehicle production.
The majority of the increase in Indian stock prices this year is primarily driven by domestic inflows rather than foreign ones. Foreign investors are presently acquiring a net position in Indian stocks after divesting in September and October.
Source: Financial Times
By. Pham Thanh Bien
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