Super excellent article on Indian Economy with with solid statistics in public domain*.

*Super excellent article on Indian Economy with with solid statistics in public domain*.

Nilesh shah- MD - Kotak AMC  on the Indian economy:

I will take liberty to point out certain factors. a) *The movie Sanju had a bigger opening collection than Bahubali 2 which was a far grander movie. It shows that urban consumption is growing at a reasonable pace.*

* Sonali Contractor sold 100,000 tractors last year. Mahindra & Mahindra, Escorts are also showing all-time high levels of tractor sales*.

*Clearly, that shows that rural economy is doing well.*

*Maruti Baleno has a four months’ waiting period. If consumers do not have money, then how come they are waiting for four months to get the car?*

*Tata Motors’ commercial vehicle production is at an all-time high record level. Generally commercial vehicles are pulse of the market, pulse of the economy*.

*If commercial vehicle sales are happening, certainly economy is rebounding.*

*Cement volume are showing double digit growth*. The cement numbers for this quarter has come ahead of expectation. If we see a variety of other FMCG companies like Dabur, Lever and ITC, their commentary is also positive in terms of rural FMCG growth.

*Put all these numbers together and you realise that the economy seems to have now rebounded, the momentum is picking up, it is reflected in last four months of IIP numbers which was above 7%.*

*It is reflected in GST collections which have crossed Rs 1 lakh crore for the first time*.

*It has taken 70 years for India to Reach 2.5 Trillion Dollar Economy*, though India will take only 7-8 more years to reach 5 Trillion i.e. the *Total amount of Money that was made in Last 70 years would be made again in the next 7-8 Years.* The Question is how much will you make? I have absolutely no doubt that the ones who can catch a few right trends in next 7-8 years are going to be very very rich.
*China took 5 years to double, US took 10 years to double from 2.4 to 5 trillion$, it is estimated that India will take 7 years* to get there.

The Idea is simple, there will be 100’s of entrepreneurs out there who will increase their profit 10-15x from current levels, they will grow at 30-40% and we need to back them. The Biggest Trend is India.

Within India there will be Sector Trends that will change every 3-4 years like.

Automobiles – *India Sold a whooping 2 Crore Two Wheelers India V/S 1.7 Crore Two Wheelers sold by China.

* Interestingly India Sold 33 Lakh Passenger Cars in FY2018 V/S 2.4 Crore in China . Slowly but Surely in the next 10 years we are confident that India will sell 1 Crore+ Cars and the average ticket size of a car would also Increase rapidly. Out of these 33 Lakh Cars, more than 50% i.e. 18 Lakh Cars were sold by Maruti alone.

*Maruti has a Market cap of 2.6 Lakh Crores and did Profit of about 8000 Crores in FY2018.*

*Financials – This is one space where the Opportunity is Largest into all Three Spaces i.e. Lending, Protection and Wealth Management.*

Lending –  *The Top 45 Business houses in India are 50% of Nation’s banking debt even after nationalization of banks.*
The Top 20% of India is well banked and Opportunities are now on the lower ticket size retail lending (80% of Population).
*With Upsurge of MFI, SME Lending, consumer finance, affordable home loans, Retail Credit is a big trend which are typically small ticket size loans with higher NIM spreads. India’s Credit needs will grow at 15-16%, whereas Smart private Bankers/NBFC can grow faster at 20-30% easy for next 7-8 years.* Their is an Opportunity to grow look book by 3-5x easily.

Protection – This Again is a multiyear theme, from Life to Auto insurance to Health to crop to even your cellphone. Here not only there will be Growth of 15-17% in the general Market but there will be large Market share shift from PSU Insurers to Private companies, we believe Private Insurers can grow 20%+ for a long long time

*Conclusion – I repeat “MORE MONEY WILL BE CREATED IN THE NEXT 7-8 YEARS THAN INDIANS CREATED IN LAST 70 YEARS” There are opportunities to make it large. There will be cyclical ups and downs. *Don’t Miss this BIGGEST TREND EVER*