A lot of literature is published at this time of the year. Not the type that goes for the Booker prize. It is about your money and how you should invest in 2023.
Experts will offer recommendations based on their assessment of the stock market situation. A lot of tailwinds and headwinds get analyzed. Numbers are crunched across the board. External and internal factors influence financial markets in India. Data on global and local macroeconomic issues, corporate fundamentals, and technical analysis would be all grounded in a list of potential winners and losers for the New Year.
Where to begin
In the year gone by, equity prices have barely moved at the index level. Given that context, your first step is to watch out for significant events that could influence share prices over the next 12 months. The first would be the Budget for February 2023. It is the last full budget to be presented by the Narendra Modi government before the general elections in May 2024. That means public expenditure is set to rise. The government may want to complete the ambitious infrastructure projects announced. At the same time, new announcements would mean companies in the capital goods, construction, and infrastructure sectors would probably get a significant boost. If you are a long-term investor, logistics is a sector to watch out. The improving infrastructure is set to boost the sector.
The public sector companies are set to play an important role. Public sector banks and other large PSUs have underperformed private sector companies for a very long time. The government’s push towards an efficient infrastructure will be through strengthening the large profitable PSUs.
Everyone jumped at the opportunity to participate in the listing and trading of consumer and payment technology companies. After the recent selloff, they seem to have turned attractive. Long-term investors could look at a basket of such stocks. According to McKinsey, a global consulting firm, e-tail transactions could grow five times to 770m by 2030. Over this decade, India is expected to double agriculture exports to $100bn, triple manufacturing in high-value exports to $400bn and cover more than 80% of the micro, small and medium enterprises or MSMEs for formal credit. Currently, less than 40% are covered.
What you can do
Your portfolio and asset allocation needs to be based on your short-term and long-term goals. For short-term investments you can try out our single stock recommendation engine – alphagenie and for long-term wealth creation do check out the alphamind portfolios at www.alphaniti.com
References
Economic Slowdown Could Hit Stocks in 2023 | Morgan Stanley
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