Stocks That Created Wealth In 2023: How To Power Up Your Portfolio In 2024?

Fireworks continue in the market as we close 2023 year out but what a fantastic December month it has turned out for the markets with benchmark indices touching record high levels both on Nifty and Sensex. To put it in percentage terms, last week in December markets were up 2%, this month 10% higher and this year almost a 20% rally is what we are seeing.

The year 2023 started with various macroeconomic concerns over inflation, rising interest rates, higher US bond yields and geopolitical shaking down investors' sentiment, however, as we close 2023, we saw a fascinating turn of events which pushed indices to new highs, according to Raj Vyas, Vice President- Research, Teji Mandi.

The December rally that we saw was backed by some key events like BJP winning 3 out of 4 state elections giving visibility of political stability in 2024, Inflation cooling off both domestically and globally with expectation of rate cuts, good earnings visibility for the remaining quarters of FY24 and FY25 and strong domestic macro position in terms of GDP growth and rating agencies reports stating India could be the fastest growing economy next year. All these positive cues lifted markets and so if we want to summarise how 2023 was we call it a "Blooming end to a volatile year" said Raj Vyas, Vice President- Research, Teji Mandi.

Investors who remained invested and bought quality stocks at reasonable prices saw stellar returns in their portfolios. The year belonged to mid and small caps which are favoured picks of retail investors clearly outperformed the benchmark indices. Hence investors who invested in broader markets had a dream run in their portfolios.

The themes that played out very well for investors were Public Sector Enterprises, Hospitality, Defence, Pharma, Autos, and Realty while on the other hand, we saw a mixed-bag performance from some of the new-age companies. Also, there was a mad rush when it came to investors applying for IPOs as we have seen returns surpassing 100-150 and even in some cases near 200%. So that's the kind of wealth creation and market performance we saw in 2023, stated Raj Vyas, Vice President- Research, Teji Mandi.

As we already highlighted what led to the stellar rally in 2023 we believe that 2024 would be another cracking year for the markets and this bullish momentum is here to stay. Industrials and PSUs have done well in 2023 as there was improvement in fundamentals plus value and we believe that there is still room left for them to perform. We may see some re-rating as well but all these depend on execution.

The other theme that is likely to play well is the defense sector. The kind of order flows that are coming and the kind of opportunity because of indigenous defense is massive so we believe defense as a theme can continue to do well.

Railway stocks have had a dream run in 2023 and it is expected to continue in 2024 with the kind of work and redevelopment, developing new stations is phenomenal.

Realty has done well despite rising interest rates and with expectations of a rate cut, realty stocks are also looking good.

Apart from these autos and hospitality also look good with the kind of new registration that we are witnessing every month and people frequently travelling post covid so the trend in sectors that we saw in 2023 is likely to continue in 2024 as well, Raj Vyas, Vice President- Research, Teji Mandi added.