imgbd AMC Speak

A granular look at themes for the coming years

Akhil Chaturvedi, Head of Sales, Motilal Oswal AMC

24th July 2017


As markets work their way up amidst a rising chorus of concerns around lack of earnings growth momentum and rich valuations, our conviction levels continuously get tested. At such times, it is imperative to go back to the drawing board, consider the facts and get a lot more granular in our understanding of themes and opportunities for the coming years, in order to be able to guide our investors with confidence and conviction.

The appended presentation is an attempt to enable you to do just that. Here's what you will find in the presentation:

  1. Snapshot of macro data over the last 3 years of the Modi regime - which points to a far more stable macro environment today than before

  2. Snapshot of the key reforms rolled out and their impact

  3. A clearer perspective on the flat earnings growth story - it may be flat at the aggregate level, but sure isn't when you get granular

  4. Themes for the coming years:

    1. Discretionary consumption: few of us realize that when per capita income of a developing economy like India doubles, discretionary spend grows 10x - its exponential

    2. Affordable housing - exactly how large is this opportunity, which specific sectors will benefit, what impact will it have on growth trajectory of each sector

    3. GST driven migration from unorganized to organized sector - which sectors get impacted by each aspect of the GST regime, exactly how large is the unorganized sector in different industries - where therefore are the best long term opportunities

    4. Value migration from PSU to Private Banks - how do business trends stack up between PSU banks and private banks, what is the extent of value migration that has happened already, what's in store in the coming years

    5. Farming industry - which sectors will benefit most from the big push towards doubling farm income by 2022

I hope you will find this presentation useful in strengthening your equity conviction and in addressing investor concerns on whether and where opportunities exist as markets scale new highs.


All source of information is from "MOSL: India Strategy Report - Taking Stock of MODIfied Regime (May 2017)"

Share this article