Budget 2024: Govt will continue to incentivise manufacturing and infra, says Nimesh Chandan of Bajaj Finserv AMC
Nimesh Chandan, CIO, Bajaj Finserv Asset Management, believes the government will continue its path to incentivise manufacturing and infrastructure in the upcoming Budget. He added that a lot of clarity has emerged around election outcomes from the recent state election results. This reduces the risk of steep volatility in the markets due to political slugfest as we approach the General Elections.
Edited excerpts: We believe the government will continue its path to incentivise manufacturing and infrastructure capex, there could be some announcements to help farmers and boost rural income. The actual measures can only be unveiled in the full Budget that would be presented after the General Elections by the new government. The recent election outcomes reduced a lot of fog around political stability & policy continuity.
The macro data points like GDP, manufacturing & services PMIs, credit growth, and strong GST collections are also indicating strength in the economy. All these things augur well for equity investors. Largecaps have been relatively under performer vs the broader market; some of it can be attributed to the direction of inflows (whether the liquidity is directed towards largecaps, midcaps or smallcaps) & also to the lack of catalysts in some of the index heavyweights.
Both these things are course correcting & we believe largecaps should have better participation in the markets from hereon. It is the intensity of the rally in midcaps & smallcaps which is making the investors nervous. It is important to have a heterogenous view on midcaps & smallcaps.
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