Fund manager Abhay Agarwal, founder of Mumbai-based Piper Serica Advisors, has noted a significant uptick in interest from international investors towards India's stock market. This heightened curiosity, particularly from family offices in Europe and large investors in the US, marks a shift in the global investment landscape.
These investors, traditionally less focused on India, are now inquiring about the safety of their investments and the rule of law in the country. This surge in interest coincides with a period of exceptional performance in India's stock market.
The market value of companies listed on India's exchanges surpassed $4 trillion in late November, according to data from Refinitiv. This milestone reflects the growing economic prominence of India on the global stage.
India's Stock Exchanges Outshine Global Peers
India boasts two major stock exchanges: the National Stock Exchange of India (NSE) and the BSE, formerly known as the Bombay Stock Exchange, which is Asia’s oldest bourse.
The NSE, larger than the BSE in terms of daily transaction value, has recently overtaken Hong Kong’s position as the seventh-largest bourse globally, as per data from the World Federation of Exchanges. This achievement places India's stock market value behind only those in the United States, China, and Japan.
Agarwal observes that the current wave of enthusiasm about India is not just a short-term interest but a deeper, more strategic inclination.
"For the first time, I’m seeing interest from very long-term investors, both strategic and financial, who are coming in taking a 10-year view rather than just a one-year view,” he explains.
This shift signifies a more sustained and profound confidence in India's market potential.
Impressive Market Performance and IPO Boom
Reflecting this optimism, India's benchmark Sensex index, tracking 30 large companies, has seen an increase of over 16% this year, while the broader Nifty 50 index has risen over 17% in the same period.
Furthermore, the Indian stock market is experiencing a remarkable boom in Initial Public Offerings (IPOs). According to a report by Ernst & Young, India witnessed 150 listings in the first nine months of 2023, significantly outpacing Hong Kong's 42 listings.