BHARAT MANUFACTURING SECTOR: A STRONG INVESTMENT OPPORTUNITY FOR LONG-TERM WEALTH CREATION
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The manufacturing sector in India is emerging as a cornerstone of economic growth, bolstered by the government's Make in India and Atmanirbhar Bharat initiatives. These efforts promise substantial benefits for investors, highlighting the sector's growing importance and potential. This sector's growth potential is closely tied to its ability to inspire confidence among consumers and investors alike, with a strong customer-first approach driving its success.
Recent developments highlight a strong trend in the manufacturing sector, marked by significant investor confidence. A newly launched manufacturing fund by a Mutual Funds company has seen remarkable success, attracting substantial investments. This success reflects the robust potential of the sector and the trust it garners from investors, making it an appealing option for long-term wealth creation.
In response to growing confidence and rising demand among customers, PNB MetLife has introduced its new fund – the PNB MetLife Bharat Manufacturing Fund. This fund provides an opportunity for customers to participate in the growth of the manufacturing sector and create long-term wealth. It is an actively managed equity fund that allows the fund manager to leverage their experience and analyse macro-level trends to outperform a benchmark or index returns.
The fund is available through PNB MetLife Unit Linked Insurance Plans (ULIPs) that offers triple benefits:
- Life cover to secure your family's future and big dreams
- Long-term wealth creation opportunity
- Tax-free returns
PNB MetLife is known for high investment repute and strong performance, exemplified by the performance of PNB MetLife equity funds which have consistently beaten the benchmark returns in the past. 99% of their equity funds are rated 4 or 5 star by Morning Star, a reputed global rating agency.
India’s manufacturing sector holds strong potential which can be seen from the impressive growth of the NIFTY India Manufacturing Index, delivering returns of 25.31% compared to the NIFTY 50's 15.29% over the past five years (as of 30th June). Even the recent budget allocations have further supported growth, with investments in infrastructure, ease of doing business, and policy reforms driving expansion.
Manufacturing Sector is an enabler for India’s $30 trillion economy (H2)
Economic Growth Driver: India is projected to become a $30 trillion economy by 2047, according to the Finance Minister. The manufacturing sector, expected to grow 18-fold over the next 24 years, currently contributes 13% to India's GDP, lagging behind Indonesia (18.67%) and Vietnam (23.88%). This gap indicates significant growth potential for India’s manufacturing sector.
Sector-Specific Growth: McKinsey identifies eleven key sectors, including chemicals, basic materials, capital goods, automotive, and pharmaceuticals, that could contribute to an 80% increase in gross value added. These sectors make up about 90% of the Nifty Manufacturing Index, highlighting their critical role in industrial growth. Bain estimates India’s exports could reach a trillion dollars by 2028, showcasing the sector's potential.
Economic Stability and Labor Advantage: India's macroeconomic stability and a large pool of skilled and semi-skilled labor offer a unique advantage among developing nations. The substantial domestic consumption base provides a captive market for producers.
Infrastructure Development: The government plans to invest ₹11 lakh crore in infrastructure over the next five years, enhancing roads, railways, and airways, crucial for supporting the manufacturing sector. Significant achievements like expanding the National Highway network, extensive railway electrification, and more operational airports are key growth drivers.
Import Substitution and Global Realignments: Government initiatives, such as Production Linked Incentive (PLI) schemes, aim to boost domestic value addition and reduce import dependence. The global realignment of supply chains, with companies like Apple increasing production in India, underscores India's growing manufacturing role.
Budget Boost to Manufacturing: The recent budget boosts manufacturing through initiatives like the Credit Guarantee Scheme for MSMEs, improving access to finance, and mandatory onboarding in TReDS. Establishing twelve new industrial parks, rental housing for industrial workers, and the Critical Minerals Mission will drive growth. Strengthening tribunals to expedite insolvency resolution will enhance the business environment and competitiveness.
Investment Opportunity (H2)
PNB MetLife's Bharat Manufacturing Fund is positioned to capitalize on these growth drivers and is one of the best NFOs to invest in 2024. Available through PNB MetLife’s ULIP plans like PNB MetLife Goal Ensuring Multiplier, PNB MetLife Wealth Plan and PNB MetLife Platinum Plus, it encourages disciplined savings and long-term wealth creation. Investors can participate in India’s vision of a 'Viksit Bharat' (Developed India) by 2047. The fund is available at a special ₹10 NAV from 1st to 15th August 2024, aligning with India’s growth story and aspirations.
In conclusion, India's manufacturing sector presents a compelling investment opportunity, supported by robust economic fundamentals, policy support, and significant growth potential. The Bharat Manufacturing Fund offers a unique chance for investors to benefit from this promising landscape, ensuring long-term wealth creation and financial security.
Disclaimer: No Business Standard Journalist was involved in creation of this content
Topics : PNB MetLife
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First Published: Aug 03 2024 | 5:14 PM IST
