Mark Mobius, the billionaire investor, remains confident about the Indian stock market‘s potential to reach new heights, despite a weaker mandate for the Narendra Modi-led NDA in Lok Sabha election results 2024.
In an interview with ET, Mobius, when asked about his earlier prediction of the Sensex hitting the 1 lakh mark within the next five years, affirmed his stance, saying that the market is still on an upward trajectory despite occasional corrections.Mobius even suggestd that this milestone could be achieved sooner than initially anticipated, considering India’s exceptional growth.
“We are still on that upward trajectory. There will always be corrections, but we are still in that direction. We will hit that (1 lakh mark for Sensex). Maybe even before five years. India may be an exception in terms of moving faster,” Mobius said.
Mobius also clarified that the current market situation is merely a pause in the ongoing bull run and not its end. He explained that generally, if a country’s economy is growing at a rate of 7%, as India is currently experiencing, the market and earnings of well-performing companies can be expected to increase at double that rate, around 14-15%. Based on this principle, he projects that the market index will continue to rise at this pace over the next decade.
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Mobius said that despite the current political turmoil in India, certain sectors will continue to thrive. He identified the software and technology sectors as being particularly resilient, including companies involved in computer hardware, semiconductors, and software development. While there may be some impact on the consumer side, Mobius suggested that the rapid growth of the Indian economy will help these companies perform relatively well.
Regarding the potential impact on PSUs, given Prime Minister Narendra Modi‘s strong support for these entities, Mobius expressed concern, stating, “Yes, I think that they will be hit and not only those but others will be hit as well as a result of the change in policies. You have seen some of the big infrastructure companies come down pretty dramatically because there is a fear that maybe infrastructure will be slowing down, the construction of roads, bridges, etc, will slow down, so that is unfortunate, but it remains to be seen.”
Mobius emphasized the need to wait and observe the decisions and actions taken by the new government before drawing any definitive conclusions about the future of PSUs and the overall market direction.
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When asked if he believes the market reached its lowest point on the day of the election results, Mobius responded, “Yes, it looks like. It may have bottomed out. But I think you have got to be cautious about that. It remains to be seen how the political situation turns out and what kind of policies will be followed by the new conglomerate of powers that take place.”
On the possibility of foreign institutional investors (FIIs) de-rating India in the near term, Mobius expressed confidence that this is unlikely to happen. He argued that FIIs recognize India’s potential and are keen to diversify their investments away from China. “…nevertheless, India is going to benefit from the desire of FIIs to diversify and that is very important,” he said.

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