After two blockbuster years for the Indian equity markets, investors pin their hopes for another double-digit year, according to the latest report by YES SECURITIES that sees Nifty hitting 21000 in 2022 and 32000 by 2025.

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A rally towards 21,000 will translate into gains of over 16 per cent from 18,003 recorded on 10th January, and nearly 40 per cent if someone remains invested till 2025.

What will drive return on D-Street? Earnings growth from India Inc. is likely to remain the main driver of stock prices in near future. It remained strong in 2021 despite lockdown, restrictions, rise in raw material cost as well as fall in demand

India’s earnings growth over the next three years is set to exceed the last decade's average substantially, according to the ‘Sense and Sentiment Report: Envisioning 2022 and Beyond’ by YES SECURITIES, a wholly-owned subsidiary of YES BANK.

YES SECURITIES envisages Nifty to hit 21,000 by 2022 and 32,000 by 2025. With abundant liquidity to keep equities in the reckoning and growing institutional participation in the Indian markets, India is expected to continue gaining share in the emerging markets basket.  

The brokerage firm is of the view that household consumption will increase in the next four years to 46 per cent with household savings at 19 per cent of GDP increasing the quantum of disposable income to be spent on consumption.

India’s demographic dividend will bolster this consumption with India’s young population highest among the top 10 economies in the world.

The gig economy will see a huge uptick with over 80 million jobs expected to be added in this decade and the contribution to GDP rising to as high as 10 per cent.

The report further highlighted that troubled sectors like Telecom, Capital Goods, Pharma, Banks, Asset Management, Real Estate, Cement, Discretionary, Building Materials among others are out of woods.

The big fear for equity markets across the globe is a tight monetary policy from the US Federal Reserve is unlikely to spoil the party. “Rise in the cost of capital will be extremely gradual with FED normalizing ultra-cheap monetary policy. Indian trends are expected to follow the global benchmark,” highlighted the report.
 
What To Buy?

Earnings season will boost the growth of the economy with most troubled sectors out of the woods. The report entails reasons for trouble and the new reality of sectors like Telecom, Capital Goods, Pharma, Banks, Asset Management, Real Estate, Cement, Discretionary, Building Materials among others.

While global markets impact the Indian outlook, the YES SECURITIES team predicts that US Taper Tantrums will not spoil the party.

Stocks that are on YES SECURITIES radar include names like Apollo Pipe, CRISIL, Dalmia Bharat, IGL, Prestige Estate, Tata Motors, and SBI.

(Disclaimer: The views/suggestions/advices expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)