2024 Investment Guide: Top 3 Sectors Poised for Growth

2024 Elections: Your Investment Guide for India and the US – Top 3 Sectors to Watch

2023 was a pretty good year for the Indian market. We saw some awesome projects kick off, the economy was doing well, and different sectors were killing it. Now, everyone’s got their eyes on 2024, wondering what’s next. 

Last year, we saw mid- and small-cap stocks go up a lot, and there were more IPOs than ever before. India is leading the race in the global market.

We are aiming to hit a $25 trillion economy in the next 25 years, and everyone’s been working hard to make that happen. The results are already showing. 

As we kick off 2024, it’s time to explore which sectors, as per your investment guide, are poised for even greater growth.

Key events in 2024

2024 is shaping up to be a landmark year with several key events that are likely to capture global attention.

Here’s Your Investment Guide: What to Look Out for in 2024 Elections

Elections

India is bracing for its General Election in April-May, a pivotal event that will set the political and economic course for the next five years.

In the United States, the Presidential Election will take centre stage, potentially influencing global politics and markets.

Similarly, Pakistan’s general election in February is set to shape its political landscape.

These elections matter because they decide the future policies of these countries, impacting everything from trade to international relations – essential insights for your investment guide.

Sports

On the sports front, 2024 is packed with major events. The Paris Summer Olympics promises to be a grand celebration.

Football fans have Euro 2024 in Germany to look forward to, while cricket enthusiasts can get excited for the ICC Men’s T20 World Cup.

These events are not just about sports; they bring economic opportunities, especially for sectors like tourism, hospitality, and broadcasting, making them essential considerations for your investment guide.

Space exploration 

In terms of space exploration, 2024 will see significant advancements. NASA’s Artemis program aims to send astronauts back to the Moon.

India’s ISRO is not far behind, with ambitious missions, including its first manned spaceflight and exploratory missions to Mars and Venus.

These space missions push technological boundaries and often lead to innovative applications in various sectors, making them essential considerations for your investment guide.

Top 3 sectors to look out for in 2024

Pharma

In 2023, India’s pharma sector made significant strides, and 2024 looks even more promising for investors seeking guidance. A major trend is the growth in the biosimilar market.

Biosimilars are essentially medical products that are very similar to and have no clinically significant differences from, an existing FDA-approved reference product.

With many biologics coming off patents soon, Indian companies with robust infrastructure are set to capitalise on this opportunity. 

Additionally, the ‘China plus one’ approach is placing India as a key player in Contract Development and Manufacturing Organisations (CDMO).

This approach diversifies global manufacturing dependencies, offering India a strategic advantage.

Looking at the numbers, the Indian pharma sector aims to reach $130 billion by 2030. A significant driver of this growth is the industry’s increasing presence in the innovation space.

As innovation forms a substantial part of the global pharma opportunity, India’s focus here is crucial.

2024 is expected to see a surge in research and development, focusing on innovative therapies and personalised medicine. This aligns with the evolving healthcare needs.

Moreover, the industry is increasingly integrating digital technologies in manufacturing and supply chains, enhancing efficiency and maintaining high product quality.

With a growing awareness of healthcare and an increasing disease burden, the Indian pharmaceutical sector is well-positioned to meet the demand for high-quality products.

This readiness is a result of collaborative policy initiatives and India’s entrepreneurial spirit, ensuring a reliable global supply of affordable, quality medicines.

Fast-moving consumer goods (FMCG)

2023 saw urban markets driving FMCG growth in India despite challenges like inflation and rural distress. Urban consumers, especially the more affluent, were keen on premium products, from luxury apartments to fancy cars.

While FMCG companies faced challenges in rural areas, urban demand kept the sector buoyant. Urban FMCG sales grew by 8% in the July-September 2023 period, outpacing rural growth.

Rural areas, which account for nearly 40% of the FMCG market in India, witnessed a dip in demand due to inflation and erratic monsoons.

However, there’s a silver lining. As inflation eases and government spending increases, 2024 could see a revival in rural consumption, especially with general elections on the horizon promising increased spending and welfare benefits.

As we step into 2024, there’s optimism about a rebound in FMCG demand. Experts predict that deflation, government spending, and election-related activities will stimulate consumption in rural areas.

Moreover, premiumisation trends are expected to strengthen, indicating that high-end FMCG products could see increased demand.

An interesting trend is the growing popularity of local and regional FMCG brands. These brands are expected to continue their upward trajectory in 2024, driven by softer inflation and competitive input prices.

Additionally, with more consumers in small towns turning to online shopping, especially for premium products, digital retail is set to expand further.

In 2023, over 50% of festive sales occurred online, and this trend is only expected to grow in 2024

Online retail, particularly in high-value categories like smartphones and appliances, is thriving, supported by various financing options.

This shift suggests that digital platforms will play an increasingly important role in the FMCG sector, making them pivotal considerations in your investment guide.

Information technology (IT)

In 2024, India’s IT sector is set for a big jump. The spending is expected to reach $124.6 billion, a 10.7% increase from 2023. 

Source: Business Standard

The biggest growth is in devices and IT services. Spending on gadgets like smartphones and laptops is predicted to grow by 10% in 2024.

This is a turnaround from a 7% decrease in 2023. IT services are also on the rise, expected to grow by 14.6% in 2024, following a 6.5% increase in 2023.

A key trend is investing in Artificial Intelligence (AI) and automation. These technologies are important for making things run smoother and filling in gaps where there aren’t enough IT experts.

Even though the biggest impact of generative AI (GenAI) might be seen in 2025, steps are being taken now to prepare for it.

This trend in India matches what’s happening worldwide. Globally, IT growth is expected to be 8% in 2024, up from 3.5% in 2023. The IT services market is also looking up, with a predicted growth of 10.4%.

With new products on the horizon in 2024, the demand for phones, laptops, and PCs is expected to rise, making them promising areas to explore in your investment guide. This surge is driven by both individuals and companies needing to update their devices.

Conclusion

2024 looks to be a promising year for key sectors in India. Pharma is gearing up for growth in biosimilars and CDMOs, FMCG anticipates a rebound in both urban and rural demand, while IT is poised for significant advances in AI and device markets.

These sectors, adapting and innovating, are well-positioned to drive India’s economic growth, keeping the country at the forefront of global market trends and serving as valuable insights for your investment guide.

DISCLAIMER: This article is not meant to be giving financial advice. Please seek a registered financial advisor for any investments.