India VS UK – who rules, who wins? How the tables turn!

Indian Equity Market has shown an aggressive growth even after the economy was beaten down by the pandemic. The Indian equity market has soared from its lows of March 2020, edging to beat the UK equity market in terms of market value and cut the chase to be among the top 5 world equity markets.

As per the Bloomberg data of the combined value of companies with a primary listing alone, the Indian equity market value stands at $3.46 trillion, representing a 37% surge this year. While the UK market value stood at $3.59 trillion representing only a 9% surge for the same period of time. These numbers exclude the secondary listings and depositary receipts, which could show a far larger divergence between the two markets.

The boom seen in the Indian Equity Market was led by the higher growth potential of the Indian market, and IPO rush in the tech sector, with ample Indian startup companies going public. The latter has fueled the growth more, giving the developed markets a good competition, as the sentiment towards the Chinese markets seem to turn sour. Indian equity market strikes as a promising domestic stock market from among the developing nations. This potential was realised and backed by a stable and reformist political base.

The failure of the UK market to keep up with its stellar performance and hold its high horse is stained with the uncertainties with the Brexit concerns looming over it.

The BSE index, S&P BSE Sensex, has outperformed the major national benchmarks and surged more than 130% since its March 2020 lows. The investors were handsomely rewarded with ~15% (in dollar terms) annualized RoE over five years which is more than double of U.K.’s benchmark FTSE 100 Index returns that clocked at 6%.

According to Goldman Sachs Group Inc., India will attain the $5 trillion dollar share market capitalization milestone by 2024. The IPOs introduced in the next 2-3 years, alone, would add a whopping $400 billion to the market value.