*Super excellent article on Indian Economy with with solid statistics in public

domain*.

Nilesh shah- MD - Kotak AMC on the Indian economy:

I will take liberty to point out certain factors. a) *The movie Sanju had a bigger
opening collection than Bahubali 2 which was a far grander movie. It shows that
urban consumption is growing at a reasonable pace.*
* Sonali Contractor sold 100,000 tractors last year. Mahindra & Mahindra, Escorts
are also showing all-time high levels of tractor sales*.
*Clearly, that shows that rural economy is doing well.*

*Maruti Baleno has a four months’ waiting period. If consumers do not have money,
then how come they are waiting for four months to get the car?*
*Tata Motors’ commercial vehicle production is at an all-time high record level.
Generally commercial vehicles are pulse of the market, pulse of the economy*.
*If commercial vehicle sales are happening, certainly economy is rebounding.*

*Cement volume are showing double digit growth*. The cement numbers for this
quarter has come ahead of expectation. If we see a variety of other FMCG companies
like Dabur, Lever and ITC, their commentary is also positive in terms of rural FMCG
growth.

*Put all these numbers together and you realise that the economy seems to have now
rebounded, the momentum is picking up, it is reflected in last four months of IIP
numbers which was above 7%.*
*It is reflected in GST collections which have crossed Rs 1 lakh crore for the
first time*.

*It has taken 70 years for India to Reach 2.5 Trillion Dollar Economy*, though
India will take only 7-8 more years to reach 5 Trillion i.e. the *Total amount of
Money that was made in Last 70 years would be made again in the next 7-8 Years.*
The Question is how much will you make? I have absolutely no doubt that the ones
who can catch a few right trends in next 7-8 years are going to be very very rich.
*China took 5 years to double, US took 10 years to double from 2.4 to 5 trillion$,
it is estimated that India will take 7 years* to get there.

The Idea is simple, there will be 100’s of entrepreneurs out there who will
increase their profit 10-15x from current levels, they will grow at 30-40% and we
need to back them. The Biggest Trend is India.

Within India there will be Sector Trends that will change every 3-4 years like.

Automobiles – *India Sold a whooping 2 Crore Two Wheelers India V/S 1.7 Crore Two
Wheelers sold by China.* Interestingly India Sold 33 Lakh Passenger Cars in FY2018
V/S 2.4 Crore in China . Slowly but Surely in the next 10 years we are confident
that India will sell 1 Crore+ Cars and the average ticket size of a car would also
Increase rapidly. Out of these 33 Lakh Cars, more than 50% i.e. 18 Lakh Cars were
sold by Maruti alone. *Maruti has a Market cap of 2.6 Lakh Crores and did Profit of
about 8000 Crores in FY2018.*

*Financials – This is one space where the Opportunity is Largest into all Three
Spaces i.e. Lending, Protection and Wealth Management.*

Lending – *The Top 45 Business houses in India are 50% of Nation’s banking debt
even after nationalization of banks.*
The Top 20% of India is well banked and Opportunities are now on the lower ticket
size retail lending (80% of Population).
*With Upsurge of MFI, SME Lending, consumer finance, affordable home loans, Retail
Credit is a big trend which are typically small ticket size loans with higher NIM
spreads. India’s Credit needs will grow at 15-16%, whereas Smart private
Bankers/NBFC can grow faster at 20-30% easy for next 7-8 years.* Their is an
Opportunity to grow look book by 3-5x easily.

Protection – This Again is a multiyear theme, from Life to Auto insurance to Health
to crop to even your cellphone. Here not only there will be Growth of 15-17% in the
general Market but there will be large Market share shift from PSU Insurers to
Private companies, we believe Private Insurers can grow 20%+ for a long long time
*Conclusion – I repeat “MORE MONEY WILL BE CREATED IN THE NEXT 7-8 YEARS THAN
INDIANS CREATED IN LAST 70 YEARS” There are opportunities to make it large. There
will be cyclical ups and downs. *Don’t Miss this BIGGEST TREND EVER*