India Strategy - Second Covid-19 Wave Unlikely To Prevent Cyclical Recovery: ICICI Securities
A trader monitors graphs and financial information on the trading inside a stock exchange. (Photographer: Alex Kraus/Bloomberg)

India Strategy - Second Covid-19 Wave Unlikely To Prevent Cyclical Recovery: ICICI Securities

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

Despite the significant impact of Covid-19, cyclical upturn is visible in corporate profits and economic growth while credit and investment cycles are clearly bottoming out along with the strengthening of corporate balance sheets.

Although it is difficult to gauge whether these trends are part of a structural super cycle or a shorter term cycle, it is amply clear that we are closer to the bottom of the cycle in terms of corporate profits, economic growth, credit growth and capex while consensus optimism is missing.

The above environment has typically not been a precursor for large drawdowns in equity markets.

Current phase of ‘stock price consolidation’ and ‘continued earnings traction’ will result in market valuations retreating from stretched levels.

Click on the attachment to read the full report:

ICICI Securities Strategy Weekly Memo .pdf

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