The long term economic backdrop for the Indian economy looks good and we can expect the coming quarters having stability in the capital markets.
Living up to this spirit, the Indian economy seems to be coming out of the cycle of low growth and subdued sentiments. We are heading towards a slow but steady recovery in the second half of the current year and greater prosperity in the next financial year. Buoyed by better economic performance and significant policy reforms, especially the cut in the corporate tax rate, Indian equities have bounced back.
The recent steps taken by the government suggest that rather than taking shortcuts or populist measures, the government is taking administrative and structural measures, which would improve the long-term performance of the economy.
Earnings have beaten expectations led by autos and financials with pre-tax profits up 13 percent YoY and 6 percent ahead of expectations.