An Latest report recently published by
Fitch and they expects that India’s resilient economic growth will boost demand
for the corporate. They named this report as “’India Corporate: Sector Trends
2024” In which they highlighted that this is a sequel to the robust performance
of the corporate in 2023 and will offset weakness from slowing growth in the
key overseas markets.
Rising demand and easing input cost
pressure should boost margins of the corporate in the next financial year,
Fitch said. Fitch said that with strong domestic demand growth, it is expected
that India will be among the world’s fastest-growing countries, with resilient
GDP growth of 6.5 per cent during the fiscal 2024-25
This is despite
a challenging global backdrop and the cumulative impact of the recent monetary
tightening, it said. Sectors like cement, electricity and petroleum products
are expected to witness a strong demand with high-frequency data in 2023
sustained well above pre-COVID pandemic levels.
Fitch said that India’s improving
infrastructure will also boost steel demand. Slowing down in the US and the
Euro-zone is likely to moderate growth of the IT services. Fitch said rising
domestic auto sales volume should drive revenues of the auto suppliers, while
travel and tourism conditions also improved in 2023.
Key sector which
could outperform :
·
Cyclical sectors: Banking, infrastructure, power, manufacturing, and
capital goods are likely to benefit from increased investment activity.
·
Consumer-driven sectors: FMCG, retail, and
e-commerce are expected to thrive on robust domestic demand and digital
adoption.
·
IT: IT services, cloud
computing, AI, and cyber security are poised for continued growth
with increased digitalization across industries.
·
Green energy : Renewableenergy, electric vehicles, and clean technology are gaining traction
due to government initiatives and environmental consciousness.
Key Risks:
·
Global slowdown: Rising
interest rates and geopolitical tensions could dampen global trade and impact
export-oriented sectors.
·
Inflation : Rising input costs and supply
chain disruptions may squeeze corporate margins.
·
Geopolitical uncertainties: Ongoing
conflicts and international tensions could create volatility in markets.
Trends :
·
Sustainability and ESG: Focus on
environmental, social, and governance factors is
increasing, shaping investment decisions and corporate strategies.
·
Innovation and disruption: New
technologies and business models are transforming industries, creating
opportunities and challenges for incumbents.
·
Focus on rural markets: Increasing
attention to rural infrastructure, digitization, and agri-businesses
hold significant potential.
·
Government's role: Policy
reforms, infrastructure development, and skill development
initiatives will play a crucial role in shaping the corporate landscape.
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