As we bid goodbye to 2022 and brace up for 2023, let’s discuss the top 3 sectors one can bet on in the new year!
After the Russia-Ukraine war in early 2022, every other country is upping its defence game. India, too, is promoting indigenous manufacturing of critical defence equipment as this is not a sector where one likes to remain dependent on imports.
The government has launched a portal named https://srijandefence.gov.in/, where it has specified which all defence equipment will be manufactured by which company, along with the dedicated timelines!
Infrastructure & Manufacturing Sector
The Union Budget 2023 will be the BJP’s last full-year budget before the Lok Sabha elections in 2024. As a result, the BJP government will be expected to leave no stone unturned on infrastructure spending and promoting manufacturing activities. This sector has multiple positive effects, including job creation and increasing incomes. They are also building infrastructure that spurs demand for other products such as steel, cement, paints, etc., thus creating a virtuous cycle!
For context, the government allocated Rs 7.5 lakh crore on infrastructure spending in the budget 2022, which was a 35% increase over the previous year! The government is also promoting domestic manufacturing through various PLI schemes!
As India aims to become a global superpower by 2050, capital will be required for various infrastructure and manufacturing projects. This is where banks and NBFCs come into play. Demand for credit will likely remain strong going forward, and the financial sector will be able to capitalise on this opportunity.
Add to this the reduced NPA cycle and cleaner bank balance sheets. This can further help them to cater to the growing credit demand in the best manner.
These sectors will have a crucial role to play as we move forward. Companies within these sectors can be prime beneficiaries of the India growth story. And investors can ride the trend by hunting for companies within these sectors!