We explore key economic themes focusing on rural recovery, inflation, and the metals sector. Since COVID, India’s lower middle-class has seen a shift in spending patterns, delaying rural economic recovery. However, in last 3 quarters, recent government initiatives have supported growth in rural sectors, contributing to defensive investment opportunities with potential for increased rate of change of growth.

Rising global inflation is being driven by increased non-growth fiscal spending, especially in the US, and expanding money supplies in countries like China and Japan. Another theme we believe is interesting over the next 3Y, is Metals. Globally, higher inflation prospects favour sectors like metals, which are under-invested due to a decade of low prices and minimal capacity expansion. With global manufacturing pick-up, particularly in India, demand for metals is expected to grow, positioning in metals has a potential to do well.