With India striving to become USD 5 trillion dollar economy by 2025, many businesses are likely to witness explosive growth making them best shares to buy in India.
The budget for 2019 unveiled last month has revealed important clues to investors about the best shares to buy in India. In the budget, the Narendra Modi led NDA 2.0 focussed on three main sectors to set the economy on the path of achieving the $5 trillion target: huge infrastructure development, easing up credit and restructuring agriculture sector. Hence many of the best shares to buy in India can be found in these sectors.
Let’s take a detailed look at these sectors:
In the budget, the government has made an allocation of Rs 100 lakh crore over five years on building infrastructure across the country. An annual spend of Rs 20 lakh crore instead of the current Rs 7 lakh crore. This includes Rs.80,000 crore allocation to upgrade 1.25 lakh kms of rural roads. The Modi government also plans to build 19.5 million houses by 2022 under the Pradhan Mantri Awas Yojana-Gramin. Overall over the next 5 years we can expect huge infrastructure development in roads, railways, bridges, airports and ports. Due to this massive boost for infrastructure, many companies in engineering and capital goods sector will get a massive boost making them best shares to buy in India.
Banking & NBFC sector
Modi government has made it quite clear about the intent to clean up the financial system which is currently in disarray. The budget allocated Rs 70,000 crore for the recapitalization of banks and a revival package of Rs 1 lakh crore for the stricken non-banking financial companies (NBFC) sector.
The results of steps like implementation of IBC code and other banking reforms undertaken in last 5 years are likely to be seen over the next 5 years with many banks cutting down on NPA size and making profits. Hence many top performing companies in this sector with low NPA size can be considered as best shares to buy in India.
The budget saw the launch of many new schemes to reduce financial stress and boost complementary income opportunities towards the goal of doubling farmers' income by 2022.
The government plans to create over 10,000 new farm producer organisations (FPOs) to improve economies of scale over the next five years and setting up many livelihood business incubators and technology business incubators to develop 75,000 skilled entrepreneurs in the agro-rural industry sector. So many top companies operating in agro-rural sector are likely to benefit making them best shares to buy in India.