Rajesh Cheruvu, MD and Chief Investment Officer, brokerage firm LGT Wealth India, says that in 2025, the focus will be on sectors related to capital expenditure (especially in the private segment). Apart from this, he believes that the renewable energy sector also looks attractive. Especially good potential is visible in the transmission and distribution segment. Cheruv says that within consumption, focus may also remain on some segments like gold/jewellery/hotels. Gold import will be at record high in November 2024.
Rajesh Cheruvu has over two decades of experience in the financial services industry. When asked whether the stock market will face more challenges in 2025, he said that the earnings season may remain sluggish in the second half of FY 2025 due to challenges on the consumption, consumer lending etc. front. However, the market will be supported by interest rate cuts in calendar year 2025.
He says that there will be no pace in the election activity in the calendar year 2025. While assembly elections were held in 8 states in 2024, assembly elections are to be held only in Delhi and Bihar in 2025. When asked which segments will be focused on in the Union Budget, Cheruvu said that the new Revenue Secretary Arunish Chawla can do something on the tax revenue budgeting front. Besides, some measures can also be announced to increase the profit of private sector companies. It is possible that relief may be given on the corporate tax front.
Regarding whether the Reserve Bank will limit the interest rate cut to 0.50% in 2025, Cheruvu said that the estimate of 0.50% cut seems to be a bit high. In fact, inflation may increase in America due to Trump’s fiscal policies, hence the Federal Reserve may limit the number of interest rate cuts.