The economy of India is in a stable political regime with the recent consecutive win of the BJP-led NDA in assembly elections, according to reports. The report added the budget also supports the stable economy.

As per the Axis Securities February briefing note, the government’s ramp-up in spending alongside an apparent revival in capex from the private sector should sequentially improve quarterly earnings.  

As of January, institutional investors in the country have kept pouring in money and as a result, the market is oversold. “It’s just a matter of time before the orientation starts changing, and would likely touch new highs by the end of the year,” said the memo.  

According to Axis Securities, the combination of the ongoing geopolitical developments and the domestic market conditions offer a rare opportunity to invest and get a higher than ten percent return on equities.  

With the constant threat of tariffs, the market is not going to be stable in the short term. “But, over the medium to long term, equities will follow the earnings trajectory and the cost of funds,” said Axis Securities.

January was challenging for Indian equities and as a result some of our strategies suffered and underperformed the allocated benchmark index. However, reviewed over the entire fiscal period, they still outperformed the benchmark by a whole lot.