Terming the just-concluded fiscal as an "okay year", a panel of financial experts said though this fiscal would be a challenging one, the domestic equity markets could turn out to be a "star performer".
Indian equities could be one of the great options for long-term investments and would give the best returns in the next 12 months, Morgan Stanley India managing director Ridham Desai told an Indian Association of Investments Professionals (IAIP) event.
The IAIP, in an online survey, has found that about 80 per cent of the respondents believe that the domestic equity markets could be the best asset class in this fiscal followed by real estate and commodities, he said.
The survey also said the respondents feel the Sensex would rally by 50 per cent this fiscal from its current 17,600-level on the back of an improving economy. The 30-scrip benchmark index of the Bombay Stock Exchange closed at 17,634 on Thursday.
The current quarter (April to June), the Sensex is likely to be at an aggregate Rs 36,000 crore (Rs 360 billion), Desai said.
The Sensex would jump up by 50 per cent this fiscal as banks, power, construction and manufacturing stocks are likely to perform well. Besides, cement companies with a 1-trillion dollar capex plan would give a major boost to the economy, noted economist and Oxus Research and Investments managing director Surjit Bhalla said.
Several global manufacturing companies have started seeing India as the most sought-after destination, he said, adding there would be a good flow of FI investments and an allocation-shift from China to India going forward.
Pharma, FMCG, retail players and mid-sized firms with high a return on equity along with media and entertainment players could be strong and emerging players this financial year, Bhalla said.
The IAIP survey said the GDP is likely to be at 9 per cent this fiscal. The survey also expressed confidence that the runaway food inflation would come down given the fact the government has taken certain steps to contain this.
There could be some short-term challenges as the next three-four months will determine the trend of the monsoons and the reported current account deficit, which could be a concern, the survey noted.
The survey also said people are quite optimistic in terms of salaries and wages, which they feel would rise by 15 per cent.
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