‘It was inevitable…’: Anand Mahindra after Indian stock markets surpass Hong Kong in market cap

Mahindra called the growth “inevitable”, adding that the “future looks strong, to say the least”. He is also optimistic that continued reforms and strong governance will keep Indian markets rising.

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“It was inevitable… Markets often seem irrational, but at their best, they are harbingers of an economy’s future. And the future looks strong, to say the least. Continuing reforms combined with strong governance of markets and the financial system will keep us Rising…” he posted.

Surpassing Hong Kong

As of the latest closing on January 22, the total value of shares listed on Indian exchanges surged to $4.33 trillion, surpassing Hong Kong’s $4.29 trillion, according to data compiled by Bloomberg.

Also Read | India Overtakes Hong Kong as world’s fourth largest stock market

Before this, India had achieved a significant milestone on December 5 when its stock market cap crossed the $4 trillion mark for the first time. The growth can be attributed to several factors, including a growing retail investor base, continuous inflows from foreign institutional investors (FII), robust corporate earnings, and strong domestic macroeconomic fundamentals, the report added.

India has emerged as a viable alternative to China, attracting fresh capital from global investors and companies. The stable political environment and a consumption-driven economy, ranking among the fastest-growing globally, contribute to India’s attractiveness, it said.

In 2023, overseas funds poured more than $21 billion into Indian shares, contributing to the eighth consecutive year of gains for the country’s benchmark S&P BSE Sensex Index. This influx of foreign capital highlights the confidence and interest in India’s thriving market.

Also Read | Stock market today: Sensex, Nifty 50 gain nearly 1% at open: 5 key reasons behind the market rally

Challenges for Hong Kong

In contrast, Hong Kong’s markets have faced challenges, with a decline in the total market value of Chinese and Hong Kong stocks by over $6 trillion since their 2021 peaks. Factors such as stringent zero-COVID measures by the Chinese government, regulatory actions on corporations, a property-sector crisis, and geopolitical tensions have collectively diminished China’s appeal as a global growth engine.

Hong Kong is witnessing a decline in its status as one of the world’s busiest venues for initial public offerings (IPO), as new listings have dried up amid challenging market conditions.

(With inputs from Bloomberg)

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Published: 23 Jan 2024, 11:51 AM IST