BQ Prime's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer BQ Prime's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
Domestic investors betting on gold (up 14%), U.S. dollar (up 11%), real estate (5%-6%), Indian stocks NSE500 (up 3.5%) and bonds (2%) earned positive returns in CY22 while those betting on U.S. big tech / IT / digital assets, emerging market and developed market stocks had negative returns. Within equities, high-beta, capital-intensive and value stocks significantly outperformed low-volatility stocks. Large-caps outperformed small-caps.
Our Nifty50 target for CY23-end stands at 20,000 implying 11% upside, which is sub-par considering the long-term expected return of at least 12% from Indian equities.
However, we expect themes related to corporate and government capex, real estate cycle, credit growth and pockets of discretionary consumption to outperform in CY23.
U.S. big tech selling is likely to end driven by the U.S. Fed pivot and earnings yield approaching 5%, which will have its rub-off effect on India IT and digital themes.
Stagflation is the key risk to equities in CY23 wherein inflation picks up again post the waning of favorable base effects while growth decelerates.
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