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By:

C.S. Krishnamurthy

21 June 2025 at 7:45:51 pm

Strong India, Cautious Investor

The Indian economy appears stronger than the nervousness visible in the stock market might suggest. Corporate earnings are improving, domestic demand remains reasonably resilient and several sectors are reporting healthy growth. Yet investors are facing an unusual mix of risks: crude oil is moving towards $100 a barrel, global bond yields are rising, foreign investors have turned sellers again and parts of the Indian market remain expensive. That leads to a simple investment message: India's...

Strong India, Cautious Investor

The Indian economy appears stronger than the nervousness visible in the stock market might suggest. Corporate earnings are improving, domestic demand remains reasonably resilient and several sectors are reporting healthy growth. Yet investors are facing an unusual mix of risks: crude oil is moving towards $100 a barrel, global bond yields are rising, foreign investors have turned sellers again and parts of the Indian market remain expensive. That leads to a simple investment message: India's growth story remains intact, but investors should not mistake a strong economy for a risk-free stock market. The latest corporate results offer considerable comfort. The economic momentum built over the past few quarters has not been derailed by geopolitical tensions. The margin pressure feared across several industries has also been less severe than expected. More importantly, earnings growth has been reasonably broad based. Large, mid and small companies have all shown healthy growth. If oil-related businesses, which are somewhat different in their earnings pattern, are excluded, the gap between the three market segments is not particularly wide. Financial services have been among the strongest performers, with banks, NBFCs and capital-market businesses reporting good growth. Capital goods, metals, telecom and power have also done well. For investors, this is significant. A stock market supported by genuine improvement in corporate profits has a much stronger foundation than one driven merely by enthusiasm. Domestic Risk The monsoon, however, remains an important domestic risk. Rainfall has been below normal so far, although the impact on the rural economy has not yet been alarming. Tractor and two-wheeler sales remain reasonably strong, suggesting that parts of rural India continue to spend. At the same time, increased demand under the rural employment guarantee programme suggests that weaker rainfall may be affecting poorer rural households more severely. Food inflation adds another complication. Higher food prices may improve the income of farmers who sell their produce, but they also increase the expenses of families who buy food. Therefore, higher food inflation cannot automatically be interpreted as stronger rural purchasing power. India is nevertheless better prepared than it once was. A healthy IPO market is a positive development. It allows companies to raise capital and gives investors fresh opportunities. But there is a point at which too much supply begins competing for the same pool of money. The current market provides a striking example. The much-awaited IPO of the National Stock Exchange is reportedly being considered at a size of around Rs. 24,000 to Rs. 25,000 crore, down from earlier expectations of Rs. 30,000 crore but a very large issue nonetheless. The message is not that investors should avoid IPOs. It is that an exciting new issue should not automatically be preferred over an established company merely because the new issue is attracting headlines. The bigger uncertainties are global. Brent crude has moved close to $100 a barrel as tensions in the Middle East have intensified. For India, which imports most of its energy requirements, expensive crude can mean higher inflation, a wider trade deficit and pressure on economic growth. US bond yields are another concern. Higher yields make dollar investments more attractive and can reduce the appetite for emerging markets such as India. This does not necessarily mean that global investors have abandoned India. It shows how quickly investment decisions can change when oil prices, interest rates and currencies move. Domestic investors, particularly mutual fund investors, therefore have an important role in providing stability. Their regular investments can partly offset foreign selling, although domestic flows cannot make the market immune to global shocks. Faster Growth The enthusiasm for small and mid-cap stocks is understandable. Many of these companies offer faster growth and have rewarded investors handsomely. But if investors pay too much for expected growth, even a good company's share price can disappoint. Large-cap companies, after a period of relative underperformance, may offer more comfortable valuations and greater stability. The right mix will depend on an investor’s financial goals, investment horizon and ability to withstand market fluctuations. India’s economic story remains encouraging. Corporate earnings are healthy, domestic demand has resilience and the economy has become better equipped to absorb individual shocks. But the stock market is not the economy. For the common investor, therefore, the most useful question today may not be, “What should I buy?” It may be, “Is my portfolio balanced enough to withstand what I cannot predict?” (The writer is a retired banker and author. He can be reached at krs1957@hotmail.com. Views personal.)

Sacred Attire

Jan 29, 2025
2 min read

Updated: Jan 30, 2025

The Siddhivinayak Temple Trust’s recent decision to implement a dress code prohibiting short skirts, torn jeans and other revealing attire is a necessary move to uphold the sanctity of religious spaces. Temples are spiritual spaces where devotees seek solace, offer prayers, and connect with the divine. Temples are not mere tourist attractions but sacred sanctuaries. The least that visitors can do is dress accordingly.


The Jagannath temple in Puri, Odisha, and the Banke Bihari temple in Vrindavan have already implemented similar rules, reflecting a growing recognition that religious spaces require a modicum of decorum. In the case of Siddhivinayak, the temple attracts thousands of devotees daily, many of whom have expressed discomfort over attire that they feel clashes with the temple’s spiritual ambience.


Few would question the need for decorum in a courtroom, a government office, or even an upscale restaurant. Yet, when religious institutions enforce dress codes to preserve their sanctity, a chorus of indignation often rises in the name of personal freedom, with such ‘critics’ arguing that such rules reflect moral policing or an imposition of traditionalist values.

But this argument confuses religious sanctity with public space liberalism. No one is being compelled to enter the temple, and those who do should respect the customs that govern it. Even in non-Hindu religious spaces, dress codes are the norm. One does not enter a gurdwara without covering their head, nor a mosque or church dressed in attire deemed unsuitable for prayer. The sanctity of a religious institution should not be sacrificed at the altar of modern whims.


To dismiss this as an encroachment on personal liberties is to misunderstand the nature of such spaces. Religious sites operate under different expectations than public thoroughfares or commercial hubs. They are designed for reflection, devotion, and ritual. While Indian society has rightly evolved towards greater personal freedom in many spheres, faith-based institutions must be allowed to maintain traditions that are integral to their identity. The temple trust has made it clear that its goal is not to impose regressive restrictions but to ensure that all visitors feel comfortable and that the sanctity of the temple is upheld.


Moreover, the argument that religious sites must remain entirely open-ended in their dress codes simply does not hold water. Many of the people who object to these restrictions would scarcely question the need for appropriate attire at a formal event or while meeting a dignitary. The principle is the same -respect for the setting dictates the mode of dress. Those who seek to frame this as a battle between liberalism and conservatism fail to grasp that such measures are about propriety, not repression.


In an era where the lines between cultural expression and decorum are increasingly blurred, it is worth remembering that not every rule is an infringement on liberty. If people can abide by dress codes in secular spaces, they should extend the same courtesy to places of worship.

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