We are currently witnessing one of the longest bull runs in the history of the Indian stock market. And surprisingly, in spite of the index reaching dizzy heights, the future still looks rosy. The Sensex in the calendar year 2005 has generated an annualised return of 41 per cent. Going forward, for this year, the economy is expected to grow by 7.5-8 per cent and India Inc. by 15 per cent. Therefore analysts predict that on a conservative basis the capital market for this financial year may deliver an annualised return of approximately 20 per cent.
HOWEVER… Early signs of a slow down in the secular growth trend are clearly visible and some sectors appear less sturdy than others. A change in the business environment, industry structure, composition of competition and other structural changes have started affecting the outlook for future revenue and profitability in these sectors.
SECTORS UNDER PRESSURE
- Airlines / Aviation
- Automobiles
- Steel
- Telecom
- Retail
- Pharmaceuticals
The Key is... Remain Cautious & Informed. Assess your equity portfolio on the basis of your exposure to these sectors and realign it, if necessary. Remember what happened to information technology funds in 2000!
Keep visiting this space to get more details on the mentioned sectors and corresponding stocks alerts.
