Given the rally seen currently in the markets, the question on the investor’s mind is how sustainable is it?

Addressing CII’s Capital Market Summit session on ‘Expectations from the New Government’, Rashesh Shah, Chairman and CEO of Edelweiss Financial Services stated that though the market sentiment has turned positive, the sustainability is dependant on follow through on growth and corporate earnings.

“There has been a positive change in the way India is being looked at now. In another 6-8 months corporate earnings and economic growth would have to be watched and followed through for the present optimism and sentiment to sustain. Market would be looking at the budget and other important announcements on FDI front as the next triggers,” he added.

According to Ananth Narayan G, Regional Head-Financial Markets, South Asia Standard Chartered, the new government’s key focus going ahead should be on fast-tracking clearance of stuck infra projects and channelise investments into the infrastructure sector.

“Currently 7 lakh crore worth of infrastructure projects are lying stuck in the last mile of approvals. If these are approved, it would help add to the company’s EBITDA, ease pressure on their balance sheets and restart the investment cycle.”

Session moderator Cyril Shroff who is the Managing Partner of Amarchand and Mangaldas & Suresh A.Shroff & Co. emphasised the importance on investing in not just physical infrastructure but also judicial infrastructure of the country to help settle disputes faster.

Predictability of contract, transparent regulations and rule of law also need to be imperative focus areas of the new government, said Cyril Shroff.

“The upgradation of the court systems should be considered as a project and government can invest $5billion to improve its infrastructure and induct new judges to see that disputes are resolved at the earliest,” he added.

Related Topics
comment COMMENT NOW