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MOSL:INDIA STRATEGY – JUL’22 | The Eagle Eye: India outperforms global markets in 1HCY22

The key highlights of our Jul’22 edition of ‘The Eagle Eye’ are as follows:

• India has outperformed key global markets in Jun’22 amid various challenges. Autos gained while Metals and Private Banks were top losers; ~85% of BSE 200 constituents declined in Jun’22.
• Activity: Average daily cash volumes dropped 45% from the Oct’21 peak. Mid-cap volumes are down 2/3rd vs. Oct’21 peak while Smallcap volumes have halved vs. Oct’21.
• The corporate profit-to-GDP ratio rebounded to a 10-year high of 4.3% in 2022. The ratio improved for 18 of 25 sectors.
• The US CPI surpassed India CPI for the first time in a decade in Sep’21 and has remained so since then.
• FIIs recorded outflows for the ninth consecutive month; outflows stood at USD6.3b in Jun’22 – the highest since Mar’20. Domestic inflows remained robust at USD6b in Jun’22; YTD’22 inflows stood at USD26.7b.
• Over the course of Jun’22, our in-house research team has published several interesting and insightful reports. Some of the notable ones are: a) Strategy: Corporate profit-to-GDP ratio – analyzing growth across cycles, b) Tube Investments: Reinvesting cash flows for sustained growth, and c) Motherson Sumi Wiring: Simplicity in complexity drives supernormal profits.