India is the world’s fastest growing economy, with favourable demographics, countless investment opportunities and consumption-led demand growth.
Welcome to a New India or should I say New Bharat.
Today, let’s discuss the numerous opportunities that awaits us as investors.
We know for sure by now how fast the Indian economy is growing. Currently at $2.6 trillion, we are expected to double this number over the next few years. With this, India is expected to emerge among top 3 economies as early as 2030. A major driving force behind this economic growth will be India’s millennials.
By 2020, India will become the country with the highest number of millennials. With a median age of 29, Indian millennials will constitute 46% of its workforce and contribute a whopping 70% of total household income.
The implications are: More income in the hands of a young population means more spending on food, two-wheelers, cars, FMCG, clothes and electronics. With increased spending, the demand of financing is also bound to improve.
According to a white paper published by the Boston Consulting Group on the FMCG sector, growth in disposable income, increased urbanization, and the increase in the number of nuclear households are driving the growth in the FMCG sector.
The sector, which is currently pegged at about $65 billion, will continue to grow by 13-14 per cent over the next 5-10 years and is likely to become a $220-240 billion industry by 2025.
India is among the top three global economies in terms of number of digital consumers. India had 560 million internet subscriptions in 2018, making it the second-largest internet subscriptions market in the world, second only to China. The number of internet users in India is projected to grow to 666.4 million by 2023. Internet users in India don’t think twice before switching their network in the quest for the fastest speed. So there is a huge potential for the telecom sector.
Opportunities Galore
Infrastructure & housing
According to estimates by McKinsey Global Institute, by 2025, India will have 69 cities with a population of more than one million each. Development of infrastructure and housing in these cities means huge demand for construction companies, building materials, infrastructure developers, capital goods sector and housing finance.
Manufacturing
India ranks 30th in the global manufacturing index report released by the World Economic Forum. This report is based on the assessment of the manufacturing capabilities of more than 100 countries. The government’s “Make in India” initiative to focus on job creation and skill enhancement in 25 major sectors of the economy has played an important role in elevating country’s position. In the past three to four years, India improved on nine out of ten parameters for ease of doing business.
India is all set to become the hub for hi-tech manufacturing with global giants such as GE, Siemens, HTC, Toshiba, and Boeing setting up manufacturing plants in India.
Automobiles
The Indian auto ancillaries industry has seen tremendous growth over the last few years. The industry accounts for 2.3 per cent of India’s Gross Domestic Product (GDP) and its turnover touched US$ 51.2 billion in FY 2017-18.
According to the Automotive Component Manufacturers Association of India (ACMA), the turnover of the Indian auto ancillaries industry is expected to touch US$ 100 billion by 2020, supported by strong exports ranging between US$ 80- US$ 100 billion by 2026.
Electronics
Electronic goods industry in India, is one of the fastest growing industries and is expected to be worth US$ 400 billion by 2020. To support export of electronic products, government has revised Foreign Direct Investment (FDI) norms and set up port-based electronic manufacturing clusters, Electronic Hardware Technology Parks (EHTPs), Special Economic Zones (SEZs).
Defense sector
From being the world’s largest arms importer, India is steadily making a move to creating a self-sufficient domestic arms industry. This can be attributed to government’s recent policy changes and reforms such as the defense Procurement Procedure (DPP 2016) and revised FDI norms which have attracted global defense companies to partner with Indian companies.
The opportunities are endless, all you’ve to do is tap them. With this rate of growth, the level of stock market indices we have seen till date is nothing compared to what we can expect in future.
It’s time to capitalize on this growth potential by investing in the right opportunities.
At Research & Ranking, we help you identify such opportunities that can multiply your wealth in the long run and monitor them periodically to ensure you’re in sync with your investment goals.
Read more: How Long-term investing helps create life-changing wealth – TOI.