Investing In The Promising ‘Make In India’ Sector

Investing In The Promising 'Make In India' Sector

The new year has brought optimism for a restored economy, aiming to go all guns blazing for a post-COVID recovery. The Indian government looking to boost demand through a plethora of public spending initiatives have been focusing on specific sectors to prompt growth.

Besides, several global firms have started to move their base to neighbouring countries, leading to a colossal shift in global trading culture. Furthermore, India’s government announced the “Make in India” initiative, encompassing the four pillars to boost entrepreneurship in India. With significant transformations going around lately, it is prudent to assess the ongoing trends and modify investment strategies. Here are the industries that have gained investors’ attention in 2021:

Pharmaceutical

Pharma companies witnessed a high demand for supplies from businesses that purchased drugs from China, even before the March lockdown. Cipla, the second-highest lungs leader globally, enjoys a hefty 68.7% market share in the respiratory inhalation segment and is now expecting a surge in demand for respiratory drugs and inhalers. With an anticipated second Covid-19 wave, the pharmaceutical industry has started working on its supplies to have no medical deficits.

Electronics

After Samsung, another global electronic giant, Apple has shown its inclinations towards shifting to India, leading to investments worth Rs 110 billion from various companies and assembly partners. Apple has begun its flagship iPhone 11 and iPhone SE 2 near Chennai and Karnataka, respectively. Besides, the primary focus on shifting manufacturing unit (focusing on electronic equipment) to other south Asian countries like India and Bangladesh to diversify its supply chains is also on the cards.

Automobiles

China, known as one of the largest automobile markets, faced significant disruptions in its auto productions soon after the COVID-19 outbreak. Many companies then opted for India to shift their production and operation base by safely venturing into it without interrupting their supply chain. When the companies looked into the favourable policies they can acquire from the government’s Make in India initiative, the PM declared a 100% Foreign Direct Investment (FDI) and full delicensing, making it easy to place their manufacturing base in India.

FMCG

India’s Fast-moving consumer goods (FMCG) sector is considered the fourth largest industry with personal and household care, accounting for almost 50% of FMCG sales in India. However, the FMCG market has developed rapidly in rural India as compared to urban. Online platforms will soon contribute 40% of all FMCG consumption in India, helping companies reach the hinterland in a much cheaper and convenient way. Moreover, with the organised sectors expanding with modern retail and a higher level of brand consciousness, it will be the right time to invest in the FMCG industry in 2021.

IT

With the revival of the US economy, devaluation of the Indian currency, and the initiative of digital India, the IT industry becomes an excellent option to invest in this year. As per the reports, India’s IT industry contributed around 7.7% to its GDP and is expected to contribute 10% by 2025. Furthermore, India is one of the highest off-shoring destinations for IT companies around the world. It has proven its abilities by delivering both on-shore and off-shore services to its clients worldwide. Nevertheless, evolving technologies now extend a complete new gamut of opportunities for Indian IT firms.

Bottomline

With significant transformations happening across sectors, India is at the cusp of a watershed moment. The electronics and automobile industries are also looking at renewal with stringent BS standards, EV push, and e-waste management systems. The Make in India campaign will push the country’s exports and manufacturing sectors, improving the economy and transforming India into a global hub through massive investments. Nevertheless, the upcoming fiscal year has got everyone excited with new investment opportunities.