It seems like the Indian market faced the worst due to the pandemic crisis during the year 2020 and the after-effects posed by the economic lockdown were towering high. So practically for an entire year, the nation was on a ‘wait and watch mode, and also the Indian investors were actually looking for growth in the market for the rest of 2020 or even for the next decade.
Sectors like IT & pharma/healthcare outperformed the rest even though the pandemic hit the market hard during the year 2020 and yes, the rest of the sectors mostly underperformed. Again, when the second wave hit the entire nation, there was instability in the market and the investors are still exploring safe options.
The outbreak may have a long-lasting impact on innumerable sectors that include commercial real estate, hospitality, banking, energy, automobiles, travel, etc. The sectors that seem to be at high risk are the hospitality sector (restaurants, hotels, etc), and transportation. And the buying interest is taking a good leap in safe sectors which are FMCG, IT & healthcare.
Therefore, it is very important for investors to scrutinize and choose the right sector which has a good potential for growth, consistent profitability, and good market share. Currently, there has been a lot of discussion on the topic – Which sector will grow after covid-19 in India.
On that basis, experts suggest the below two sectors which are best sectors to invest in the long term and predicted to have a good growth for the next 5 years.
These two sectors are also considered the fastest growing industry in India – 2025. Let us discuss in detail these sectors:
Post-COVID, the healthcare industry is under prime focus, not only in India but across the globe; it is expected that the pharma sector will reach good heights and is considered as one of the industries expected to grow in the next 10 years in India. The Pharma sector is going forward globally as the health spend is increasing across the nation.
In the last couple of quarters, pharma has proved that it is a good space for investors. During the year 2021, the pharma sector was one of the sectors that outperformed other sectors. In fact, it acted as a savior for investors by giving them substantial returns. And the hope for the year 2021 is still high that the pharma sector will continue to be on focus as the demand for life-saving drugs and immunity-boosting supplements is always leveraging high and as always people never stop buying healthcare products.
Also, after the vaccination drive, there is good scope for the listed pharmaceutical companies as the nation is looking forward to welcoming many other variants of the vaccine. The Pharma sector is listed as one of the best sectors for long-term investment in India. As the technology keeps evolving, pharma companies are investing heavily in their development & research activities.
In a nutshell, the healthcare industry as a whole will keep growing and hence, investors can opt for the pharma sector for investment.
2. FMCG (Fast Moving Consumer Goods)
FMCG is considered the most defensive sector for making a long-term investment in India. Products manufactured in this industry have been used by people for over 100 years and will also continue to be in the future. Unlike other sectors that fall under the contraction and expansion cycle, FMCG is a sector whose products will always be in demand.
During an economic crisis, people may not be able to spend on automobiles, invest in real estate, or take new loans, but they may not skip the basic necessities that FMCG offers. For sure, its demand will not decrease when compared to other industries. In the past few years, FMCG has also started growing in rural areas/villages as the trends are changing now.
Therefore, the FMCG sector has a very good growth opportunity in all areas. Also, both first & second wave of COVID has triggered people to stock up the essentials. This has considerably boosted the sales of FMCG companies. Thereby, for the above reasons, FMCG stands as one of the best sectors to invest in India post-COVID.
Choosing consistent industries for long-term investment can help you gain good profits which will help to secure your future. As an intelligent investor, it is wiser to choose a sector that is on the growing trend for now and in the future. After the global pandemic, the markets have been highly volatile so it is crucial for investors to gain a thorough understanding of the chosen sector, defined goals of consumers, and the nature of stocks.