Market capitalization of firms listed on BSE tops $4 trillion

The market capitalization of shares listed on BSE breached the $4 trillion mark on Wednesday, making India the fifth country to achieve this feat.

The exchange crossed the milestone on a day the benchmark Nifty 50 index regained the 20,000 peak after a gap of two months.

The rally was driven by a robust recovery in Adani group shares over the past two sessions, following the Supreme Court’s decision to reserve its judgement on various lawsuits demanding a probe into the allegations in the Hindenburg report.

The surge in Adani group stocks added close to ₹1.05 trillion in market cap over the past two sessions, stock market data showed.

The soaring market capitalization comes on the back of positive sentiment among investors in India’s growth prospects.

The primary markets in India are also on a roll. Tata group firm Tata Technology made a robust debut on the exchanges on Thursday, with shares doubling on their listing debut on NSE and BSE. Shares of Gandhar Oil Refinery, another IPO candidate that made their debut on Thursday, made a stellar debut by listing at a 75% premium to the IPO price. Fedbank Financial, another new entrant to the market, however, listed on the exchanges at a discount of 1.6% on Thursday.

Shares of state-run clean energy funder Indian Renewable Energy Development Authority (IREDA) hit their upper circuit, or their daily permissible limit, on their debut on Wednesday in an indication of soaring investor appetite for promising initial public offerings.

Analysts have, however, advise caution over the near term prospects in the wake of general election that is due next year.

Societe Generale on Wednesday cautioned volatility ahead of elections, downgrading India equities to ‘neutral’ from ‘overweight’ earlier.

The downgrade came on a day the Organisation for Economic Cooperation and Development (OECD) said India’s growth would slow down to 6.1% in the next fiscal amid adverse weather-related events and the weakening international outlook.

The Paris-based organization retained its growth projection for India at 6.3% for the current fiscal on the surge in services exports and public investments.

However, over the long-term, India’s growth prospects remain strong.

India is projected to surpass the US and become the world’s largest economy by 2052, The Times of India reported on Wednesday, citing a report by foreign broking major CLSA.

The report projects India will have nominal gross domestic product (GDP) of $45 trillion by 2052, five years after the government-christened Amrit Kaal ends. The government calls the 25-year period spanning from 2022 to 2047, coinciding with India’s centenary of Independence celebrations, as Amrit Kaal.

India is poised to overtake Japan and become the world’s third-largest economy by 2027. By 2047, the end of Amrit Kaal, India’s economy will be worth $29 trillion, the CLSA report projected.

A recent S&P Global market intelligence study said India is on course to surpass Japan and become the world’s third-largest economy with a predicted GDP of $7.3 trillion by 2030, up from $3.5 trillion now.

India’s GDP already surpassed that of the United Kingdom and France last year, and is predicted to surpass Germany’s by 2030.

The Reserve Bank of India expects India’s real GDP to grow at 6.5% in the fiscal years 2023-24 and 2024-25, making India one of the world’s fastest-growing economies.

As of now, the US remains the world’s largest economy with a GDP of $25.5 trillion, representing a quarter of the world’s GDP.

China is the second largest economy, with a GDP of $18 trillion, or nearly 17.9% of the world GDP. Japan follows next with a GDP of $4.2 trillion, followed by Germany with a GDP of $4 trillion.