THE CHANGE OF GUARDS

THE CHANGE OF GUARDS

The outbreak of pandemic Covid-19 all over the world has disturbed the political, social, economic, religious and financial structures of the whole world. Amidst this turmoil and volatility of the market, we do see opportunities and avenues for investments.

In the table below, we have compared the top 10 sectors driving NIFTY in Jan 2020 vs. June 2020. The stocks driving the market were always predominated by the financial and IT sector and were consistent and strong in upholding their position at the top but with this pandemic, we are witnessing a sector rotation. The underdogs are starting to come to light and rise from the bottom of the charts.

Though Banking and Finance sectors are still leading at the top and will probably continue driving the market but now, the proportions are noticed to be changing. This sector rotation is the deal-breaker.

Telecom's weightage to the overall NIFTY was at a mere 1.94% and in a matter of six months, its weightage is up to 5.6%. Similarly, Pharma, Telecom and Consumer Goods Sector are now contributing with almost 2% higher weightage as compared to in Jan.

We strongly advocate opportunities are at our doorsteps ready to be welcomed which will also have a major impact on the new age economy in the country are:

• Telecommunications Industry
• Power utility industry
• Automobile industry (2 wheeler, tractors)
• Utility Products
• Agricultural Sector (Pesticides, fertilizers)
• Pharmaceuticals Industry
• Consumer Market

There have been a lot of downfalls in the economy over the past few months, but all hope is not lost. The market is said to rise from the ashes and bring back the hopes and dreams of many new businesses. 

The most benefitting sector post-COVID-19 would be the rural economy and the industries supporting them. These industries are the least affected by the pandemic and by the lockdown in the country. And with the funding and support of the government, the rural economy concept is set to rise to new heights.

The future of MSMEs (Micro, small and medium enterprise) also looks promising in the coming years, as mid and small caps are now available at a reasonable valuation. Also, they have higher dividend yields and are striving to operate with a  lower debt rate.  

The market is evolving and so are we!

With this new era of businesses developing which look promising for certain sectors and small business owners; a phase of  “Make in India” has started, and in the coming future, India may emerge as a new Superpower in the world.