The Indian stock (capital) market has achieved a record growth rate of 20 percent in the year 2023. In the year 2023, Sensex has closed at the level of 72,082 points with a gain of 11,399 points (18.73 percent), while Nifty has closed at the level of 21,731 points with a gain of 3,626 points (20 percent).
Due to the above mentioned boom in the Indian stock market, the market value of investment in shares of investors in the Indian stock market has increased from Rs 81.90 lakh crore in the year 2023, whereas in the year 2022 it had increased from Rs 16.38 lakh crore. This has been possible due to India’s consistently high level of economic progress and the stable political environment in the country. A surge in the stock market was also seen due to the formation of the Bharatiya Janata Party government in the recently held elections in three states. In the year 2023, the market capitalization of shares of companies listed on Bombay Stock Exchange has increased by Rs 81.90 lakh crore to the level of Rs 364.28 lakh crore. The above growth rate recorded in the Indian stock market in the year 2023 is the highest among all the emerging markets of the world. On November 29, 2023, the market capitalization level of all the companies registered on the Bombay Stock Exchange had crossed the level of Rs 4 lakh crore, which is more than the size of the Indian economy. In the context of India, this is also a record in itself, because the size of the Indian economy is currently only Rs 3.75 lakh crore. On March 24, 2021, the market capitalization of all the companies registered on the Bombay Stock Exchange had reached the level of Rs 3 lakh crore, thus in just a span of 2 years and 8 months, the market capitalization of the shares issued by the said companies increased by an amount of Rs 1 lakh crore. has increased.
In the year 2023, a growth rate of 47.52 percent has been estimated in India’s Bombay Stock Exchange’s Small Cap (market capitalization of shares issued by small-sized companies) index. At the same time, the Mid Cap (market capitalization of shares issued by medium-sized companies) index has achieved a growth rate of 45.52 percent.
The 30-share Bombay Stock Exchange Index has registered a growth of 4.87 percent in the month of November 2023 alone and has grown by 7.83 percent in the month of December 2023. Thus, the months of November and December 2023 have proven to be very fruitful for investors in India. All this is due to India’s GDP achieving a strong growth rate of 7.8 percent in two quarters of the financial year 2023-24, April-June 2023 and 7.6 percent in July-September 2023, and the incomparable growth rate in the profitability of companies. It has been possible. Also, India’s economy remains strong at the macro level and inflation has now been brought under control. There has also been some softening of oil prices in the international market. This has also shown stability in the value of the Indian Rupee at the international level.
Today, the market capitalization of Reliance Industries shares in the Indian stock market has crossed the level of Rs 17.48 lakh crore, which ranks first in India. At second place is Tata Consultancy Services, whose share market capitalization has crossed Rs 13.88 lakh crore, at third place is HDFC Bank with share market capitalization of Rs 12.98 lakh crore. At the fourth position is ICICI Bank with a stock market capitalization of Rs 6.99 lakh crore. Infosys company is in fifth place, whose stock market capitalization is Rs 6.40 lakh crore.
Foreign portfolio investors have also invested an amount of more than Rs 1.70 lakh crore in the Indian stock market in the year 2023. This shows the ever-increasing confidence of foreign investors in the Indian economy. In the month of December 2023 alone, an investment of Rs 66,134 crore has been made by foreign portfolio investors in the Indian stock market.
There is now a possibility of reduction in interest rates in the American market in the year 2024, due to which American portfolio investors can invest more amount in the Indian stock market in the year 2024 also. In the year 2022, foreign portfolio investors had pulled out Rs 1.21 lakh crore from the Indian stock market as developed countries had drastically increased interest rates with the aim of bringing inflation under control. Whereas in the year 2021, Rs 25,752 crore, Rs 1.7 lakh crore in the year 2020 and Rs 1.01 lakh crore in the year 2019 were invested in the Indian stock market by foreign portfolio investors.
Amidst the possibility of inflation being under control in various countries in the year 2024, there are indications of reduction in interest rates by the central banks. In America, the bond yield, which was more than 5 percent, has now come down to less than 4 percent. Therefore, foreign investors will definitely increase their investment in a fast growing economy like India. Thus, there are possibilities of a bullish trend in the Indian stock market even in the year 2024.
The number of retail investors in the Indian stock market has not only increased but the confidence of these investors in the stock market has also increased and now retail investors have also started achieving success in increasing the market value of their investments by taking the right decisions at the right time regarding investment. Are. More than 13 crore demat accounts of more than 8 crore retail investors have been opened in India. Demat account is the account through which shares are bought and sold in the stock market.
The prices of crude oil in the international market have also reduced by about 10 percent in the year 2024, this has also had a particularly good impact on the Indian economy and in other countries too, it can reduce the inflation rate and improve the profitability of companies. An increase has been registered. It is also a good news that Russia-Ukraine war, Hamas-Israel war and the ever-increasing tension between West Asian countries have had little impact on the Indian capital market.
Due to the huge investments being made in the Indian stock market by foreign investors and the continuously increasing foreign direct investment in India, India’s foreign exchange reserves have also crossed the level of US $ 62,000 crore. This is a very pleasant situation for India.
Retired Deputy General Manager
state Bank of India