"The fiscal discipline of the government means that its expenditure would be a little controlled. We are hoping for a normal monsoon, so the agriculture sector will be okay. At 6.8%, India would still be the fastest-growing major economy," says Crisil CEO Amish Mehta
"The fiscal discipline of the government means that its expenditure would be a little controlled. We are hoping for a normal monsoon, so the agriculture sector will be okay. At 6.8%, India would still be the fastest-growing major economy," says Crisil CEO Amish Mehta
The commentary on the budget has had a more positive impact on the bond market compared to the stock market. The unexpected drop in yields has cheered the bond market. The fiscal deficit number of 5.1% has exceeded the debt market s expectations. The lower net borrowing program and the possibility of rate cuts in the second half of CY24 have given confidence to the market. The capital expenditure target for this year has been revised down to 950,000 crore, but there is still a 17% increase compared to last year.
Saurabh Mukherjea expects a resurgence in private sector capex, growth in IT services and engineering R&D companies, and a pick-up in private consumption driven by the job market and interest rate cycle. The Marcellus founder discusses the optimistic outlook for private sector capex in India, highlighting names such as RSI, RHI Magnesita, and Grindwell Norton as plays on the steel demand and abrasive provider sectors. He also emphasizes the potential of Trent s Zudio proposition and Star Bazaar as disruptive players in the retail market.
To meet India s aspirations of building quality infrastructure, a minimum 8% gross capital formation in infrastructure as a percentage of GDP is needed, he says.