The COVID-19 pandemic has driven many individuals to the point where they’re now unsure of where to invest their hard-earned money in the stock market. If you’re in the same boat, then this guide can help you. Here are top 5 sectors that you can consider investing in during this phase.
1. Pharmaceuticals and healthcare
Considering the current scenario, investing in the pharma and healthcare sector is clearly one of the obvious choices. The pandemic has literally forced this sector to go into overdrive with a sudden surge in demand for life-saving and generic drugs, PPE kits, and other medical equipment. This growth is likely to persist in the near future, making this sector one of the most attractive investment options there are.
The Fast Moving Consumer Goods (FMCG) sector has long been considered to be a defensive sector. What this essentially means is that the demand for these goods are likely to stay strong irrespective of the current market or economic scenario. As a matter of fact, many successful investors have always turned towards defensive sectors whenever the going got tough.
Even before the pandemic hit our shores, the telecom industry had been witnessing impressive growth. Due to strict social distancing norms and state-wide lockdowns, many have moved onto work from home setups and virtual meetings. This has led to an increase in the demand for internet and high speed mobile services. With 5G nearing wide-scale implementation in India, the future for the telecom industry seems to look bright.
4. Specialty Chemicals
Domestic demand for specialty chemicals may be modest, but rising demand for exports has shielded the specialty chemicals industry from the worst effects of the pandemic. The future growth prospects for the sector are also looking good, given that a McKinsey report indicated that the specialty chemicals market in India is expected to grow into a $40 billion industry. If the sector receives policy support from the government, and if adequate importance is given to environmental policy compliance, the future of this sector looks good from where we stand today.
5. Information Technology (IT)
The unique thing about information technology (IT) is that it is rarely disrupted. And even in the face of black swan events like the pandemic, this is one industry that can succeed in getting back on its feet sooner than later. The current scenario is no different. IT processes have continued uninterrupted, thanks to a little shift in the way India works. It comes as no surprise then, that the Indian IT industry added $4 billion in the year of the pandemic, with IT services nearing $100 billion in size. Given how COVID-19 has also reinforced the need for digital and contactless solutions, IT will continue to remain the backbone in the new normal.
Irrespective of what sector you’re planning to invest in, you would need a demat account to do so. Motilal Oswal allows you to open a demat account online from the comfort of your own home. Get in touch with us right now and open your very own demat account.