As 2017 Approaches, Lets Embrace The New Year With Wiser Investment Decisions

It is a critical time for the country’s economy as I write this. Confusions, anxieties, concerns, speculations and controversies have been surrounding us since November 8 night when two high-denomination notes were scrapped by the government. As we step into the new year, clearing all the clouds of confusions and controversies, we expect to witness a brighter tomorrow and stronger economy. The efforts so far taken by the government though have led to chaos for commoners, but it all indicate a better tomorrow, even for the retail investors after few months of volatility in the stock markets. Indeed 2016 has been a tough year for the market participants and it has been even tougher for FPIs as Indian rupee depreciation has ensured negative returns for those investing from their offshore setups. The year 2017 could well be a year for emerging markets including India. Stock prices have already corrected noticeably and they have fallen enough to make an attractive proposition for value and long term investors in our view. FPIs and DIIs may continue to be the net buyers of Indian equities and the earnings can be expected to clock double digit growth in 2017 after effects of demonetisation mellow down – which in our view may take one or two quarters hereon.

Going forward we expect some added volatility on the Dalal Street due to union budget announcements and also developments on GST as some states including West Bengal and Kerala have been showing sudden inertia towards implementation of the proposed unified tax regime. No great triggers as of now for the markets except any sudden event internationally does take place. Already the union budget expectations are being built in the markets with several announcements expected by the current government to ease the pain suffered by the Indian citizens. Infrastructure sector along with banking sector will remain in limelight. Digitisation will change a lot of things for the banks and the ways customers use the banking services and products. There is a good probability that digitisation wave in India will lead the country’s banking sector into a more profitable trajectory. 

Investors may well be advised to stick with quality banks’ stocks which are also ahead on the curve in terms of helping clients migrate to its online platform. Interest rate will play a major factor in coming year. It is no brainer the rates are headed southwards and isn’t it one of the most desirable thing in for equity investors. Investors and traders need to watch closely the INR- USD parity along with the crude oil prices during next one quarter. Rising crude oil prices pose a challenge to our trade deficit mechanism and can also make matters worse for the big oil importing nations like India. This in turn may deplete value of the stock-holders of Oil Marketing Companies (OMCs). In this edition of your favourite investment fortnightly we have refined and brought forward top 1000 companies from various sectors highlighting their H1 performance, study of which we believe will provide you an edge entering into the new year of investing i.e 2017. As March approaches, individual investors have started looking for best ELSS funds that they can invest in mainly in a sincere attempt to save on paying taxes. Following our unique mutual fund selection methodology, we have identified top seven ELSS schemes which could provide investors some good tax planning options. Slowly but surely markets should inch up and smart investors may have already started accumulating shares taking a valuation call. Staggered manner buying and no leverage trading is the call of the hour. Discipline and patience will be tested in current market situation. Look towards long-term investing at this juncture while expecting handsome returns in 2018, 2019. Short-term investment goals may be kept on hold for now considering certain economic and also political uncertainties as five states including Uttar Pradesh will be voting to elect new governments in their respective states which may upset many existing political equations in the country.

I will write back to you next time in the new year. Have a investment worthy year ahead, stay prosperous, stay with us.