If You Only Walk Long Enough…!

Cherchire Cat comes to the rescue of Alice when she gets lost in the wonderland.

Lewis Carroll in his famous work – “Alice in Wonderland”, puts it beautifully:

Alice – “Would you tell me, please, which way I ought to go from here?”

Cherchire the Cat  – “That depends a good deal on where you want to get to,”

Alice – “I don’t much care where –-” 

Cherchire – “Then it doesn’t matter which way you go.”

Alice – “ -– so long as I get somewhere,” 

Cherchire – “Oh, you’re sure to do that, if you only walk long enough”

This in summary is our takeaway for all investors asking which way to go from here. Our answer throughout the year has been consistent – “Keep walking, walk long enough and you are sure to reach your destination.”

What we witnessed in 2023:

• The Russia-Ukraine war continued
• The US went for an 11th straight rate hike at the start of the year
• Oil again touched the $100 mark
• US Treasury touched a high of 5%
• Commodity guzzler of the globe – China slowed down considerably
• Historic high inflation across the globe especially in US and Europe
• Israel-Hamas tension erupted
• Global sea routes were disrupted

…And what we got in 2023:

• Nifty50 gave 20% returns, Nifty Midcap 150 gave 43.7% returns and Nifty Smallcap 250 gave 48% return.
• Gold delivered about 12.5% returns
• Nasdaq delivered 44.5% returns

We can date back our analysis as many years in history as we would like, painting the article red with all the negative events of the past like the Twin Tower bombing, the Global financial crisis, COVID-19, etc.

But only one data is good enough to capsule our thoughts – since the start of this century, Nifty has delivered positive returns in 19 out of 23 years, with a double-digit return in 14 out of those 19 years!

2024 will be no different when it comes to unsettling news flow. There are elections in over 50 countries in the world. Elections in the largest democracies of the world – India, the US, and the UK. Elections in our neighborhood – Pakistan, Bangladesh. The year will be splashed with populism & politics. The list of things that can go wrong is pretty long – Oil, commodities, election results, interest rates, inflation, military escalations, geopolitics, etc.

Yet, we continue to believe that in 2024:

• India will overtake Japan to be the third-largest economy by Market capitalization
• India will see the largest exercise of democratic franchise giving a stable mandate 
• India will perhaps see the rate cycle reversing by the second half
• Nifty EPS should be nearing Rs. 1050 and growing at about 10-11%
• We could see a return of Private capex in the second half and rural demand picking up
• We would see continued and relentless govt push on Infra and public capex like roads, railways, airports, etc
• We would see more Indians traveling, consuming & dominating global charts
• And hopefully, we wash our sorrow of losing the ODI World Cup by winning the T20 WC 😊

In a nutshell, we continue to believe that India would see not just a 9th consecutive year of positive return but a year of positivity all around! This is our ‘Tryst with Destiny’. We, as a nation and we as individuals will surely reach somewhere if we heed the advice of Cherchire and ‘walk long enough…”

Here’s wishing you and everyone in the family a year full of positivity and good health – Happy 2024!