Investment Circa 2012

The Indian Investor

6 months into the year and just about the time for you to review your financial decisions and goals set out at the beginning of the year. According to a poll, Indian investors continue to have a high degree of confidence in the local economy, and are in favor of keeping their investment money close to home.

For investors who have invested in the Indian Stock Markets, the daily

newspapers may not ring cheering bells.

Factors affecting the Indian Economy• The most important factor affecting our markets is the ongoing global

economic crisis which has affected developed as well as the emerging economies.

• The issues faced by the US and Europe, which have unsustainable debt levels, have pushed some countries on the verge of bankruptcy.

The global economic environment turned adverse in September last with the crisis in the Euro zone.

Domestic factors like tightened monetary policy, depreciating rupee, persistent inflation and slow industrial growth and FII investments attributed to the current domestic crisis.

Despite this, however, Indian economy still looks positive in terms of growth and stability. The Economic Survey expects the growth rate of real GDP to pick up to 7.6% in 2012-13 and faster beyond that.

• Concerted efforts are on through the G-20 and other forums to restore

stability and renewed growth.

• Addressing of sovereign debt crisis, financial regulation, growth and job

creation efforts and energy security.

Initiatives by economic forums

Despite fears of Policy paralysis, inadequate monsoon and low growth,

economists do believe that India remains one of the fastest growing

economies.

Analyst on Indian Economy

• Despite of economic volatility the Indian market outperformed its peers showing lot more resilience and strength compared to other emerging economies.

• Despite of RBI’s recent announcements and the rupee depreciation, the Indian Nifty still displayed an upward trend.

This is the best times to begin investing in equity because:

Given the current market scenario, stock prices have undergone massive correction and are ripe for investing.

Despite the current global crisis Indian Companies have displayed strong fundamentals for profit in the later quarter.

• The 55-page declaration said the developing countries should be given assistance in ensuring long-term debt sustainability through coordinated policies.

• It also focused on innovative financing mechanisms can make a positive contribution in assisting developing countries to mobilise additional resources for financing for development.

Rio +20 Summit• Further relief is also expected from the Rio +20 Summit.

• Prime Minister Manmohan Singh said that many countries could do more if additional finance and technology were available.

• The ongoing economic crisis has made matters worse.

Conclusion

As an investor, this is the most opportune time for investors to start buying

selective stock of companies and stay invested in the long term. The market is

expected to show signs of improvement and grow in the latter half of the year

and long term investors still stand to make considerable profits from Indian

Equity.

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