Indian markets are at a premium as compared to other global peers. Where to invest?

According to MK Wealth Management, investors should grab the premium opportunity Indian market To invest in quality stocks. The brokerage has listed three sectors as top picks for investing in equity.

These BFSITech and Manufacturing.

In his latest note titled “Navigator”, MK pointed out that last month, Indian equities traded lower due to external factors, especially the US interest rate policy.

Currently, the Indian market is in a consolidation phase.

However, Emkay’s note said, “Investors should use this opportunity to invest in quality BFSI, tech and manufacturing.”

“The Indian equity market is expensive compared to both developed and emerging markets. While the premium at which the market is trading may moderate, it will not pan out,” the brokerage said.

Highlighting further, MK’s note said, domestic is costlier than both developed and emerging markets. Although the premium at which the market is trading may moderate but it will not be exhausted given the potential for growth and expansion.

It added, “Any corrective pullback is a buying opportunity in the markets in the long term.”

In the second half of the year, the slowdown is likely to moderate and growth may be visible again in major economies.

America is in a mild recession! MK’s note states that the persistence of

And the continued reliance on hard money has sown the seeds of an economic slowdown that has already set in.

However, the note said, “Many experts view this as a mild recession and not a serious one, including forecasts made by former Federal Reserve Chairman Alan Greenspan.

Furthermore, growth in China has been in the low single digits, but with the reopening of the Chinese economy, MK is hopeful that a turnaround in this country’s economy is probably just around the corner.

MK’s note states that the rate of growth in India should be understood against this backdrop.

MK’s note states that for the financial year FY24, India’s GDP growth is expected to be in the range of 6.00% to 6.50%, and this growth rate is comparatively high when we look at it in a broader context. The overall demand outlook is also likely to remain good with urban demand on a strong side and rural demand slowing due to higher price levels in the last one and a half years.

Also, the PLI scheme and its positive impact on the overall manufacturing sector should be overlooked. In addition, agricultural credit expansion intended to the tune of 20 Lakh Crore and the rush to the effect of Rs. The Rs 10 lakh crore capex provided in the budget will support trade and industry and spur manufacturing activity.

In addition, India Inc. Earnings remain resilient. MK’s note said that the quarterly results brought with them quite interesting figures, with a clear resilience displayed by businesses that were based on stable models. Sales growth remains resilient but input cost pressure is still visible on operating margins.

MK’s note said that despite commodity prices holding steady or correcting marginally, “an inability to pass on cost pressures has resulted in margin erosion.”

But, MK also expects the increase in interest rates to impact PAT margin going forward as well.

For the banking system, MK said, “credit growth indicates a healthy credit demand.”

Accordingly, MK suggests investing in banking, tech and manufacturing stocks!

On December 1, 2022, the Sensex touched a historic high of 63,583.07 and the Nifty 50 touched a record high of 18,887.60.

From its all-time high, the Sensex has fallen over 4% and the Nifty 50 is down nearly 5%. Meanwhile, so far in 2023, till February 17, the Nifty 50 has fallen over one per cent, while Sensex losses have been largely muted.

On Friday, the Sensex closed at 61,002.57, down 316.94 points or 0.52%. The Nifty 50 closed at 17,944.20, down 91.65 points or 0.51%.

Disclaimer: The views and recommendations given above are of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.