"With abundant liquidity to keep equities in the reckoning and growing institutional participation in the Indian markets, India is expected to continue gaining share in the emerging markets basket," said domestic brokerage firm Yes Securities, which has set a Nifty target of 21,000 in 2022.
According to Yes Securities, household consumption will increase in the next four years to 46 per cent, with household savings at 19 per cent of GDP, increasing the quantum of disposable income. However, consumption will not be dented by inflation.
Yes Securities research sees tell-tale signs of consumption revival on both ends of the spectrum - higher agricultural production to deal with food price pressure, and increasing average monthly spend per credit card in India.
"Earnings season will boost the growth of the economy, with most troubled sectors coming out of the woods. The report entails reasons for trouble and the new reality of sectors such as Telecom, Capital Goods, Pharma, Banks, Asset Management, Real Estate, Cement, Discretionary and Building Materials, among others," it added.
Though global markets impact the Indian outlook, Yes Securities predicts that the US taper tantrums will not spoil the party. "Rise in the cost of capital will be extremely gradual, with the Fed normalising its ultra-cheap monetary policy. Indian trends are expected to follow the global benchmark, it said."