The year 2024 concludes on a reflective note for India. As capital markets eclipsed China in Asian fundraising and neared global leadership, the passing of Dr Manmohan Singh casts a long shadow. His pivotal role in shaping modern India’s economic landscape cannot be overstated. Singh, the architect of the 1991 reforms, alongside then Prime Minister PV Narasimha Rao, ushered in an era of liberalisation that redefined the nation’s trajectory.

Architect of Economic Resurgence

Singh’s tenure as finance minister was transformative. He dismantled the License Raj, fostering private sector growth and attracting foreign investment. Corporate tax cuts and export-friendly policies fueled India Inc’s profitability. His reforms extended to banking and insurance, paving the way for a diverse and robust financial sector. The establishment of the National Stock Exchange (NSE) during his leadership further solidified the market’s foundations. Though his career wasn’t without blemishes, including the securities scam and corruption allegations during his premiership, his contributions to the Indian economy are undeniable.

Markets Legacy and Future Outlook

Singh’s reforms not only benefited investors but also uplifted millions from poverty through initiatives like MGNREGA and Aadhaar. His vision laid the groundwork for direct benefit transfers and financial inclusion. As markets navigate current economic cycles, his legacy provides a robust framework. In light of this, market expert G Chokkalingam advises a balanced approach to investing, prioritising fundamentals over mere momentum. He suggests focusing on company management, balance sheet strength, and valuation comfort, especially in a market anticipating credit growth moderation.

Stock Picking in New Year

Chokkalingam highlights concerns regarding Bajaj Finance’s valuation, anticipating a sector-wide slowdown. He favours HDFC Bank, citing its improving metrics and the potential of its subsidiary, HDB Financial Services, listing to boost capital. This perspective underscores the enduring importance of value investing, a principle that aligns with the long-term economic vision championed by Dr Singh.

What does Singh’s legacy mean for investors? His reforms instilled confidence and created opportunities. As markets evolve, his emphasis on strong foundations and strategic growth remains relevant, guiding investors to look beyond short-term fluctuations and focus on enduring value.

Image Courtesy: X (Rohini Anand)