Market outlook: Join today for a special discussion on the market outlook for 2025. Tushar Pradhan, Director, HXGON Partners LLPHe has nearly 3 decades of experience in investing. Tushar has been CIO at HSBC AMC for 14 years. Apart from this, he was also associated with HSBC AMC from June 2009 to April 2023. He has also worked in senior positions in Tata AIG, HDFC AMC. Let Tushar ji understand which theme he is focusing on for the new year.
Tushar said that in 2024 we got very good returns in many asset classes. Almost double digit returns were achieved in equity. Apart from this, gold, debt and crypto currency also increased a lot. Wherever investors invested, they got very good profits. However, equities started slowing down after October. Talking about the prospects of 2025, crypto, gold and real estate do not seem to have the same prospects as 2024. Gold was boosted by purchases by central banks in 2024. Crypto currency got a boost from Trump’s sale. The effect of increase in wealth was seen on real estate. But these three triggers are not going to be there in 2025.
Talking about the outlook for the equity market in 2025, valuations are already at historically high levels, especially in the US. Talking about India, we are down by about 7-8 percent from the peak. But this does not mean that valuations are good everywhere. Valuations are good in some pockets. If we talk about small and mid caps, the valuation is running on an average of 30-40. If we keep all these things in mind, then we should keep our expectations a little lower in 2025. Equity returns in 2024 have been 14-15 percent. It may yield slightly lower returns in 2025. Going forward we may see de-rating in valuations. Because earnings growth is likely to slow down.
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Talking about the market, Tushar further said that the important trigger for autos has been the slowdown in urban demand. Recovery in rural demand is possible with a good crop. Spaces like FMCG and cement will benefit from rural recovery. FMCG, cement and housing credit companies may perform better in 2025 than 2024. You can also take 10-15 percent exposure in news age companies.
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