Growth Sectors in Indian Stock Market

Banking:

The Indian banking industry is on the threshold of change. Its highly fragmented nature will be completely transformed. Consolidation will be the order of the day. Even the government has stated its intention to encourage mergers and acquisitions in this industry in order to make it globally competitive. This would lead to the re-rating of several stocks of both public and private sectors banks.

Power and power equipment:

Power is a critical ingredient for maintaining high economic growth. Reforms and investments undertaken in this sector by the government spell good news for this sector. Likewise, the ongoing huge capacity additions in generation and a thrust on distribution will directly benefit companies in this sector.

Infrastructure:

Inadequate infrastructure is the biggest obstacle to growth. To put things in perspective, the country needs a whopping $150 billion in FDI in this sector over the next five years to sustain the economic growth. Doing its bit, the government is investing heavily in this sector. It is also favouring development of this sector with policy initiatives such as FDI in infrastructure , tax breaks and so on.

Software:

Good software stocks are a ‘must have’ in your equity portfolio as they epitomise strong fundamentals. Further, these scrips offer better revenue visibility and are comparatively immune to external shocks and adverse geopolitical developments .

Exploration – Oil and Gas:

Oil and gas is the life blood that is crucial for India’s economy . Due to strategic reasons the government will continue to nurture this sector. The sector is likely to see a lot of action with revenue multiplying manifold in future.

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