Healthy monsoon indicates a strong harvest this kharif season. Good soil moisture and water reservoir levels indicate a strong Rabi produce. That's positive for agri focussed companies
Downward revision in gas prices negative for upstream gas players, but positive for downstream gas marketing companies, fertilisers, tiles and power sectors
The implementation of agri reforms calls for the development of a parallel country-wide infrastructure for the sale and purchase of crops
While we wait for the actual implementation of the farm bills, our preliminary analysis of the reforms suggests a positive impact on farming and Corporate India
Markets react to delta/change in events, numbers and narrative. Prospects of additional fiscal stimulus, geopolitical risks and uncertainty with respect to US elections will get more and more investor attention
The new monetary policy framework – “robust updating” - puts focus on broader and inclusive employment and is more tolerant of higher inflation before any hikes in interest rates are considered
While there are pockets of the markets that stand to gain in the post pandemic world, many of these stocks will have factored in earnings of many years to justify their current valuation
Do keep an eye on our steady earnings analysis as it is important to know who will survive in style and who will not
This however doesn’t take away the risks. The virus is the central risk. It can jeopardise and delay the economic recovery, leading to more financial instability
Indian drugmakers such as Cipla, Cadila, Lupin, Dr Reddy’s, Sun Pharma and a few small-sized pharma companies such as Laurus Labs may benefit from a likely revamp of US medicare
Timely monsoon, strong growth in sowing acreages and healthy reservoir level augur well for agriculture and Rural India
A potential change of US regime in favour of the Democrats can have a salubrious impact on the “equity risk premium” - as a more collaborative world would reduce risk.
Will the market re-test the March lows? We do not think so. Investors should take advantage of the exuberance to get out of weaker businesses and wait for valuation to turn attractive in stronger ones
From a market standpoint, loose fiscal and monetary conditions are the perfect ingredients of a raging bull market in equities
Big five is what matters most to the financial system
Fed’s dot plot clearly conveys a strong consensus for “lower for longer” rates. On top of that, the Fed ascertains that policy tools/stimulus measures would be used “forcefully, proactively and aggressively” as the need arise to support economy.
The parity between bond and earnings yield is achieved at the Nifty level of 9133 – downside of 10 percent. This is the maximum downside that we see for the markets and investors should steer their investment decisions accordingly.
Import dependency on China for a range of raw materials (APIs, basic chemicals, agro-intermediates) and critical components (Auto, Durables, Capital goods) is skewed.
The big will get bigger as marginal competition finds it difficult to survive
On the export front, the opportunity for Indian manufacturers are humongous if there is a sizeable shift in opportunities from China to India.
Investors with less appetite for risk should stick to the Nifty