A MORE THAN 100 per cent surge in equity markets has encouraged many small investors to start trading or directly invest in stocks. They have also been encouraged by the wave of initial public offerings (IPOs) that have given stupendous listing-day gains. Over 10 million Demat accounts were opened in 2020, which is a record.
However, there is every chance that the easy gains of the past year may make investors complacent and prone to taking riskier bets. Here’s how they can be cautious and yet partake of the bull market gains.
The Bull Market
After six to seven years of weak economic growth, we are at the cusp of economic revival. Companies are reporting good numbers despite the nation suffering the deadly second wave of the pandemic. The BSE Sensex has risen 120 per cent from the lows of April last year that it had touched amid the announcement of the nationwide lockdown. “Eventually, all market levels are a function of two things—corporate profitability and valuations driven by fund flows. Despite the first wave and the stringent lockdowns in Q1 of last year, corporate India has reported record profits,” says Nilesh Shetty, Fund Manager, Equity, Quantum AMC.
Most companies reported record margins and strong revenue growth in FY21. The year saw 15 per cent top-line growth and 85 per cent bottom-line growth at the index level (excluding financials).
How Long Will the 'Bull' Run?
There is a strong correlation between GDP growth, corporate earnings, and equity returns. Expected double-digit GDP growth will boost corporate earnings. As long as corporate India continues to grow, share prices will keep going up, say experts.
This story is from the October 03, 2021 edition of Business Today.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the October 03, 2021 edition of Business Today.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
Picking Up The Paytm Pieces
Paytm Founder Vijay Shekhar Sharma Is Back In The Trenches After Rbi's Recent Action Left Him Without A Banking Platform. There Are Still Some Opportunities, But He Will Have To Move Swiftly To Grab Them
PMS Vs MF The Big Fight
How do mutual funds and portfolio management services match up? Know the score on structure, rules, entry fees, charges, and tax perks to pick the right path for your financial journey
Four Levers Of Enterprise AI Strategy
Wide-scale private sector AI deployment and new AI-based business opportunities and ecosystems can truly supercharge the Indian economy
"Don't let a unique chance slip by"
JEFF MAGGIONCALDA | CHIEF EXECUTIVE OFFICER | COURSERA
THE INCOMING DISRUPTION
The disruption in the industrial sector is still unknown, but inevitable. Companies need to wake up
THE WHEEL WHISPERER
For Manan Shah, Managing Director of MICL Group, luxury cars are not about showcasing one's wealth or status. It is about personal well-being
TRIPPING WITH TECH
A road trip is an adventure like no other. While you take in the experience, get some peace of mind with these nifty gadgets
Transforming Spaces
WHETHER YOU WANT TO REDECORATE YOUR BEDROOM OR HALLWAY, A GORGEOUS WALLPAPER ADDS FLAIR TO YOUR HOME AND ALLOWS YOU TO STAMP YOUR STYLE IN YOUR NEW ABODE
ALPHATALE
MONEY MANAGERS TO THE AFFLUENT DELIVERED ROBUST RETURNS TO INVESTORS IN THE PAST YEAR, THANKS TO THE BUOYANCY IN THE MARKETS. BUSINESS TODAY DECODES THEIR STRATEGY
"THE ALTERNATIVES SPACE CAN GROW 3X IN FIVE YEARS"
Vikaas M. Sachdeva, MD of Sundaram Alternates, talks about where India's alternative investment industry is headed