Hello Friends!! First of all thanks for showing interest in the Sensex. This is good sign that you are alert of your finance matters. And being finance literate is the need of the day for every individual. Interestingly there are so many even educated people around us who are not at all finance literate.
Anyway, coming back to our topic… Future of Indian Stock Market. I believe that the future of Sensex and Nifty is extremely Bright.
There are so many factors which are in favour of Indian Stock Markets which can be listed as follows:
Largest Democracy and Economic Policies and Sensex:
This is the most important aspect which we should always remember. Being the democratic country, whichever political party may be in government, they have to work within the limits of constitution and they cannot exorbitantly change the economic policies. And this is the biggest plus point which brings the stability in the economy.
Scope for Improvement and Need for Improvement:
In India, there is need for improvement in almost every aspect of the life. In India, there are no roads in so many villages, there is no electricity in so many places, and it requires lots of improvement in education. All these are so many gaps. Yesssss!!! This itself means, every gap, every shortfall and every need for improvement is nothing but BUSINESS OPPORTUNITY. And interestingly India also has the all the resources, all the talent, and most importantly entrepreneurship in existence. This is the extreme combination that is there are gaps and there is talent also to fill the gap. So this is the unique situation which exists in India. Contrary to this in developed economies there are no such gaps or shortfalls so the saturation point is already there.
In India, there are lots of checks and regulations on the working of the listed companies. There are so many checks and monitoring on the working of stock exchanges, so many disclosures, and so much governance is already in place. The Regulatory Body SEBI plays very important role positively. Dematerialisation and online transactions of stock markets has revolutionized the operations of stock market. This has brought extreme transparency and which means more faith of investors.
Minuscule retail participation in Sensex and Nifty
Currently in Indian Stock Market retail participation is extremely less. Huge percentage of share in participation of the Indian Stock Markets is of Foreign Institutional Investors (FIIs). Still extremely less percentage of Indians invest in stock market. Again as I mentioned earlier, this gap itself is huge opportunity. Over the period, through education and awareness, the participation of Indians in stock market is going to increase. And over the period the surge in retail participation directly and through Mutual Funds, will take the SENSEX and NIFTY to the New HEIGHTS.
Huge Market for Business will ultimately help Sensex:
India is probably the biggest market of the world. Just imagine the population of more than 1.25 billion. And that too with the youngest population in the world!!! Boom Boom Boom!!! Such a huge market in the world is extreme business opportunity for the future entrepreneurs. Indian as well as foreign entrepreneurs will definitely get attracted towards India. And one important thing, due to its hugeness, the dependency of the Indian economy on other economies in the world will reduce over the period. Yes, as today, the world has become global village, Indian Stock Market also gets impacted by the other economies of the world, but only in short run. But in long run it will definitely be UPWARD!
China Factor and Sensex:
Yes China is the biggest competitor of India. And it has made progress by leaps and bounds. But the MOST important thing!!! China does not have Democracy. The socialist government of china can bring abrupt changes in the economic policies of the country, and makes their economy unstable. In fact in recent past Chinese government tried to bring restrictions on the transactions of the participants in their stock market. This is totally against the free market conditions of demand and supply which actually drive the stock market. This may be the biggest BLUNDER of socialist regime of the china. This may in fact divert the biggest chunk of the Foreign Investments from china to India.
Of course it is very difficult to predict stock market, and to answer if Sensex will touch mark of 100000, but definitely there are so many factors which make Indian Stock Market as MOST ATTRACTIVE in the WHOLE WORLD!!!! In fact in past also equity investments have given best returns.
Investors across the world will definitely pour millions….billions…… of dollars into Indian Stock Market in next 10 years and will take the Indian Stock Market Indices like Sensex and Nifty to the Extremely New Heights!!!
Hope you like this article, and as you like this article you love to share it happily!!!
Please check this book – Everything You Wanted to Know About Stock Market Investing