Q2 MARKET REVIEW
We have seen a volatile market place but with an upward bias since the last 2 Quarters.
Our basic hypothesis is that Indian markets will continue to deliver a real rate of return continues.
The top 154 listed entities continue to deliver a robust growth of 19% of earnings basis year on year and 15% on sales on an year on year basis.
Our view is that Banking and Financial Services continue to do well on reducing npa’s and increase in fee based income.
As a sector infrastructure is still coming out of the woods although approvals from the centre have reduced the pressure on the system.
Expansion of the cabinet relieves the Finance Minister of his defence responsibilities leading to a greater focus on GST & Land Acquisition bill which has been a bottleneck for growth for the last couple of years.
The relevance of GST( Goods & Sales Tax) is that with its introduction margins can rise by 3-5% for companies across the Board on a real time basis.
The rise in 2nd quarter has been led by IT,Pharmaceuticals and Financial Services.
Markets may stay volatile in the short term however they are good from a medium term point of view.