BSE manufacturing index to outgrow benchmark indices next few years: Emkay
Aug 09, 2023
New Delhi [India], August 9 : Riding on the hopes of a strong manufacturing sector outlook, Emkay Investment Managers Ltd. (EIML) on Wednesday said the BSE manufacturing index, which has been growing at a faster pace than the key benchmarks, is likely to continue in the next few years.
EIML is the portfolio management services arm of Emkay Global Financial Services and has been a SEBI-registered Portfolio Manager since 2003.
Emkay today held a media webinar ‘Media Convergence with EIML’ where the latest investment strategies and how manufacturing companies continue to be an attractive investment proposition were discussed.
It sees a lot of promise in the Indian manufacturing sector, given favourable government policies, and key beneficiaries of the China+1 strategy, among others.
According to EIML, BSE manufacturing has grown at a faster pace than the key benchmarks and the same performance is likely to get replicated in the next few years.
The current government capex is seen at 2x of historical averages. Both central and state capex are significantly higher than the historical averages. As per the available data, the central plus state capex is around 5.6 per cent of GDP, which was 2.8 per cent of GDP pre-COVID 20-year average, it said.
“India’s manufacturing sector is an idea whose time has come. The government’s thrust and Make in India, PLI scheme-like policies will continue to provide the required push for growth. We expect the sector to witness traction domestically due to the structural issues that were addressed,” said Krishna Kumar Karwa, MD, Emkay Global Financial Services
“We also expect the sector to witness fund flows from overseas as the China+1 strategy takes on in full flow,” Karwa added.
Speaking at the webinar, Sachin Shah, Fund Manager, Emkay Investment Managers Ltd said, most of the growth elements have fallen in place for the manufacturing sector.
“Local manufacturing by domiciled companies, and foreign companies looking at setting bases in India has accelerated growth. The big push is likely to come from the central and state governments in the form of infra projects of large scale.”
