India @77: From Interdependence to Independence, a glimpse

To be very honest, I wanted to start the newsletter with “Dozens of political parties have come and gone..” but not much later an epiphany hit me that majorly only two political parties with a few coalition governments have ruled India. Nonetheless, we would not be discussing India’s political landscape today.

This week’s newsletter is going to be a Food for Thought for you if you’re the one who is constantly confronted with the question that “Is India doing enough?” We are celebrating 77 beautiful years of Independence and I think it’s time we start appreciating how far we have come? 

I’ll try to keep it as short as possible. Let us begin

Recognition at Global Level: INR X Rubble

India’s image at international platforms is mixed. But it is rapidly changing from that of the land of poverty to the land of smart programmers and techies. India is being invited on global platforms by countries and Free trade Agreements are getting signed daily. Even if we ignore all these facts, who would have thought that one day, International trades would be happening in INR. Yes, you heard it right.

Concept of de-dollarisation is becoming way too real and way too soon. Dollar which is considered as the world currency, is losing its mark. First, India imported cheap oil from Russia using INR and now it has entered into an agreement with Saudi Arabia and 19 other countries. With the advent of strategies like China plus one, MNCs have been setting up their manufacturing plans in India due to its flexible policies. This says nothing but that India is marking its mark on the world.

Pioneers of Digitisation 

If you ask any Indian, what is the one big recent advancement which they wouldn’t imagine their life without, most of them would say UPI and UPI is not the only thing. India has been a pioneer in digitisation by introducing Aadhaar Cards, Fast tags, ONDC, Digilockers and UPI, to name a few. 

It’s the deep penetration of telecom services and internet accessibility in India with efforts from both private and public sector. Jio one day came in with free internet for everyone easing the way to a digital India. Let’s take digital payments as an indicator. The number of digital payments have gone from four thousand billion in 202o to fifteen thousand in 2022, that is a massive growth!

Have a look at some more numbers here:

Sky’s the limit for Businesses 

The house of Tatas, Ambanis, Adanis is breaking that ceiling which has long echoed that Indians cannot compete at global level. As many as 8 Indian companies including IOCL have been featured in this year’s Fortune 500 list. I would not shy away saying that the credit goes to the government as well. Schemes like Atmanirbhar Bharat, Production Linked Incentive, Anti Dumping Duty have motivated domestic producers to be one step ahead. India’s global economic and growth trends indicate positive tailwinds and this is the reason that we see foreign companies collaborating with Indian manufacturers.

Startup Hubs

India, which was considered a backward economy in terms of innovation post independence, now has the world’s third largest startup ecosystem after US and China. With 108 unicorns against 46 of the UK and 34 of France, India is only moving forward. The reason here is India’s diverse population. From agritech to fintech, we have got a market for everything. 

With millions of problems at hand, Indians have a reputation of doing jugaad and now we are monetising this with our high-tech jugaads turned startups. With over twenty schemes like the Atal Innovation Mission, Startup India Initiative, Digital India etc. the government is betting heavily on startups. 

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Rise of Middle Class

India’s middle class population represents 31% of the total population and is estimated to increase to 62%. Whenever one talks about the middle class in India, the only word that comes to my mind is Premiumisation. If we look at the data, there is an all time high consumption of consumer durables and FMCG. Apple opening its retail stores in Delhi and Mumbai and luxurious brands like LV and Cartier making Deepika Padukone their brand ambassador is a prime example. 

Step towards Top Notch Infrastructure

World’s third largest road network, fourth largest railway network, over 300x increase in power generation capacity, 77% mobile phone penetration rate, world’s second best internet connectivity and so much more. The numbers speak. The government is spending well on the country’s infrastructure. For FY23 itself, the budget for infrastructure was increased by a whopping 33%. 

Over the years, infrastructure has gone from being a government controlled sector to now having private players. Two Infra companies that we’ve been invested in – J Kumar Infra and Titagarh Rail Systems have been bagging multiple contracts to design and construct government projects.

A look at the Data: India is said to become the next global power. India is investing in infra the same way China did in 2008. It is fair to say that 2008s China is today’s India.

Protecting its own – Defence sector 

We take pride in having the second largest army in the world after China. We are the third largest spender in Defense. And the sector is going through nothing less than a revolution. Colonisation crippled India’s defence industry forcing us to spend exponentially to import required equipment. 

Cut to 2023, we are now capable of manufacturing high-end products ourselves. This year, India is spending over 13% of its budget on defence. Defence is a government controlled but private companies, like Bharat Forge that we’re invested in have become important stakeholders. The below data represents figures from Budget 2024.

Recession risks covered? 

Indian stock markets have been very unorganised until SEBI came into picture but efforts were constantly being made to revolutionise the system. We have gone from having next to no retail participation initially to now 40% of investors being retail investors. It was in 1977 that the first IPO of Reliance was offered in India, and this year, 32 IPOs have already come and gone. The numbers themself speak volumes (pun intended).

Indian stock markets are currently at par with the world, even better right now. While the US is struggling to keep itself from going into a recession and China’s economy is slowing down having gone into deflation, Indian markets are booming. FPI f=inflows have been breaking the ceiling  and we are seeing companies deliver exponential numbers. Our indices are breaking records and reaching their all time highs putting the Indian economy on a pedestal. 

Even during a global pandemic when global indices were going down, only Nifty showed positive growth as seen in the chart below.

No matter how different our point of view, political ideologies, or support for the government are, one thing that is common to us is Pride. The Pride that makes our eyes glimmer when the Prime Minister hoists our Tiranga on the top of Red Fort with Jan Gana Man in the background that gives us nothing but goosebumps. 

We hope nothing but the ever waving flag of India, Happy Independence Day

Weekly Market Wrap-up by Green Portfolio

We are super excited to announce that we are launching a new series – Weekly Market Wrap-up by Green Portfolio. Every Saturday at 12 PM, we will come live to discuss our favourite thing – stock markets. 

This Saturday at 12 PM, our CEO and founder, Mr. Divam Sharma will discuss:

• What’s been up with the markets

• National and International news that caught our attention
• How we are looking at the economy as research analysts

Tune in every Saturday at 12 PM

Join in and ask us questions that we’ll answer live!

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Green Portfolio is a SEBI Registered (SEBI Registration No. INH100008513) Research Analyst Firm. The research and reports express our opinions which we have based upon generally available public information, field research, inferences and deductions through are due diligence and analytical process. To the best our ability and belief, all information contained here is accurate and reliable, and has been obtained from public sources we believe to be accurate and reliable. We make no representation, express or implied, as to the accuracy, timeliness, or completeness of any such information or with regard to the results obtained from its use.