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India’s Strong Fundamentals Cushion Risks, Report Favors Selective Equity Exposure
A report says India’s economy is doing well even though the world economy faces several problems.
These problems include geopolitical tensions, expensive crude oil, persistent inflation, and high bond yields.
India’s economy grew 7.8% in the first quarter of FY27.
People’s spending and business investment also increased.
Many large companies earned more profits, and smaller companies performed better than expected.
However, the report says investors should not buy everything because many new shares are being offered.
It recommends choosing strong companies carefully, especially among midcap and smallcap stocks.
The report also prefers gold over silver and certain income-producing investments.
Motilal Oswal Private Wealth retained a neutral stance on equities while favoring midcap and smallcap stocks.
India’s real GDP growth reached 7.8% year-on-year in the first quarter of FY27.
Private consumption grew 7.1%, while gross fixed capital formation increased nearly 11.9% during the quarter.
Nifty 50 companies recorded nearly 18% year-on-year profit growth, while midcap and smallcap earnings outperformed expectations.
The report recommended allocating 40% to hybrid and largecap strategies, 10% to global equities, and 50% to midcap and smallcap shares.
- Who
- Motilal Oswal Private Wealth, with comments from Chief Investment Officer Sandipan Roy, issued the analysis.
- What
- The report assessed India’s economic outlook and recommended a neutral overall equity stance while favoring midcap and smallcap stocks.
- Where
- India, with the report issued from New Delhi.
- When
- The analysis was reported on Monday and covered the first quarter of FY27, with IPO figures from April through August FY27.
- Why
- Strong domestic growth and corporate earnings are supporting India, but global risks, elevated valuations, and a large pipeline of share issuances require selective investing.
Key facts
- Real GDP growth
- 7.8% year-on-year in the first quarter of FY27
- Private consumption growth
- 7.1% during the quarter
- Gross fixed capital formation
- Nearly 11.9% growth during the quarter
- Nifty 50 profit growth
- Nearly 18% year-on-year in the first quarter of FY27
- IPO fundraising
- About Rs 46,000 crore between April and August FY27
- Recommended allocation
- 40% hybrid and largecap strategies, 10% global equities, and 50% midcap and smallcap shares
- Precious metals view
- Neutral overall, with a preference for gold over silver
Quotes
Sandipan Roy
Chief Investment Officer at Motilal Oswal Private Wealth
“We continue to see merit in midcap and smallcaps, while maintaining discipline on valuations and preferring accrual strategies in fixed income as global yields remain elevated,”
thehansindia.com
Sources
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