As we bid adieu to 2023, we take a retrospective glance at a year that has significantly shaped India's economic landscape, marked by a blend of victories and hurdles.
Throughout this year, a multitude of occurrences left an indelible imprint on the country's economic narrative, with certain highlights standing out distinctively. From the soaring performance of Dalal Street and the resurgence of the IPO market to India's ascendancy as the world's fifth-largest economy, pivotal events dotted the economic canvas.
Amidst the milestones, an Indian bank earned global recognition, although the year also witnessed a surge in credit card expenditures among citizens. The conspicuous spike in credit card usage, albeit not attributed to tomato prices, coincided with an unprecedented surge in the cost of this kitchen essential, causing distress among numerous households.
Simultaneously, as digital payment platforms gained ground, the Reserve Bank of India (RBI) chose to phase out the elusive Rs 2,000 notes, a decision announced earlier this year.
Reflecting on the tumultuous narrative, the clash involving the Adani Group and US short-seller Hindenburg Research gripped the Indian stock markets, causing ripples through its corridors. Let us delve deeper into the key events that defined the realm of business and the economy throughout 2023.
The Indian stock market experienced a staggering bull run, witnessing the Nifty 50 index reach unprecedented highs, achieving a remarkable year-to-date return of +18 per cent.
Notably, mid and small-cap stocks outperformed even more remarkably, recording gains of +40 per cent and +50 per cent, respectively.
Milestones were crossed as the Sensex surged beyond the 70,000 mark, and the Nifty surpassed 21,000, propelled by sectors such as defence, real estate, automotive, public sector enterprises, and pharmaceuticals.
Jaspreet Singh Arora, CIO at Research & Ranking, remarked, "This year showcased strong sectoral performances, with defence, real estate, automotive, PSEs, and pharmaceuticals emerging as top performers, while nascent industries emerged as surprise contenders."
The bullish momentum was further fueled by the launch of 58 mainboard IPOs, signifying robust investor confidence, Arora added.
In 2023, India solidified its position as the world's fifth-largest economy, a testament to its substantial growth amidst global economic apprehensions.
Several contributing factors propelled the nation's economic surge, including augmented government expenditure on infrastructure, robust macroeconomic indices, amplified foreign investments, robust corporate expansion, and astute policy measures adopted by the Reserve Bank of India (RBI).
Jaspreet Singh Arora elaborated, "As we conclude 2023, there's a positive stance with the RBI revising the FY24 GDP outlook by 50bps to 7 per cent, and the US Fed hinting at a minimum of three rate cuts in 2024."
Arora also cautioned that the Indian general elections in May and the US Presidential elections in November might induce market volatility in the lead-up to these events. Nonetheless, he expressed optimism, citing a potential decrease in oil prices coupled with the robust earning prospects of Indian corporations, painting a favourable outlook for the 2024 market scenario.
"Segments like financials, IT, and thematic areas such as manufacturing, public sector enterprises, and healthcare might offer lucrative prospects in 2024," Arora speculated.
Furthermore, 2023 witnessed a flourishing phase for initial public offerings (IPOs) in India, witnessing a diverse array of businesses making their debut on the stock exchange.
The year witnessed a spectrum of companies, ranging from conventional industries to tech-driven entities, accessing the capital markets through IPOs.
With 58 mainboard IPOs launched in 2023, over 50 of them yielded profits post-listing, raising nearly Rs 49,500 crore. Additionally, 172 SME IPOs made their way into the markets, securing nearly Rs 4,500 crore in funding.
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