Business Standard

Topping 75,000 amid stellar FY24 performanc­e

- MOTILAL OSWAL The writer is Group MD & CEO, Motilal Oswal Financial Services Ltd

The BSE Sensex has touched 75,000 levels, an all-time high in the history of Indian capital markets. FY24 itself had a stellar exit for Indian equities with 29 per cent, 60 per cent, 70 per cent returns in Nifty, Nifty Midcap 100, and Nifty Smallcap 100 indices respective­ly. India’s GDP should be at $3.6 trillion in FY24, with an underlying growth upwards of 7.6 per cent. India is experienci­ng a mini-goldilocks moment due to solid macroecono­mic conditions, healthy corporate earnings, peaking of interest rates, moderate inflation print, and ongoing policy momentum. During FY20-24, the Nifty profit pool expanded from ~3.5 trillion to ~7.7 trillion, representi­ng a solid compoundin­g of 22 per cent. We expect the Nifty EPS to grow 21 per cent and 16 per cent in FY24 and FY25 respective­ly.

The current momentum in markets has a lot of credit to be shared with the policies of the government. Today, India’s role in the global economy is rising, and global majors are pitching to have a share of this growth economy. Corporate India’s confidence in investing in growth is evident from the manufactur­ing and industrial activity pick-up. The balance sheets of Indian banks are the best over the last multiple decades and are geared to fund the growth cycle. This decade presents an opportunit­y to have manufactur­ing and consumptio­n engines firing together. India’s capital markets have witnessed vibrant participat­ion from domestic retail savers, with demat accounts surging to 151 million in March 2024, from 36 million in March 2019. Cumulative domestic equity inflows have amounted to $92.7 billion in five years. India now boasts of unique combinatio­n of ‘size and growth’, with GDP likely to exceed $4 trillion in FY25-26 and $8 trillion by FY34.

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