V Subramaniam remains positive on the Indian market due to visible earnings growth in the next few years. However, he acknowledges the presence of global and domestic risks that can suppress the market. Valuations are a challenge in certain sectors, but the financial space, banking, and some consumer discretionary names still have reasonable valuations.
The seemingly relentless decline in prices of Chinese goods amid tepid consumer demand is denting expectations that corporate earnings can revive the flagging stock market.
Ajay Bagga expresses caution about the NBFC sector and expects a decline in revenues, margins, and growth trajectory. The truck and vehicle finance sectors are performing well, but the rural demand has not picked up. In the IT sector, there is a slowdown in orders, and companies need to focus on new revenue avenues such as artificial intelligence and cloud growth.
Abneesh Roy says: “In our view, in Q3, most of the companies will see flat to low-single digit volume growth in the rural areas while urban areas will be growing faster. Even in Q4, we do not see a big recovery in rural demand currently. Our sense is the recovery will happen in FY25, based on Rs 1 lakh crore election spending, government stimulus, freebies, etc.”
Abneesh Roy says: “In our view, in Q3, most of the companies will see flat to low-single digit volume growth in the rural areas while urban areas will be growing faster. Even in Q4, we do not see a big recovery in rural demand currently. Our sense is the recovery will happen in FY25, based on Rs 1 lakh crore election spending, government stimulus, freebies, etc.”