Global investor Mark Mobius is pretty enthusiastic about the Indian stock market. He believes that, in the next five years, the Sensex will make it past the 1 lakh point mark. That’s precisely why India holds the second-largest spot in his investment portfolio as well. Now, Sensex at 1 Lakh, is it a reality or just a dream? Let’s dig in –
So, Can the Sensex Reach the 1 Lakh Mark Milestone?
Back in 2018, the Sensex was hovering around 35,000. Regardless of the various ups and downs since then, it has now surged beyond the 64,000 mark. That’s an impressive 83% growth during this period.
So, given the challenges such as the COVID-19 pandemic, the Russia-Ukraine war, a European recession, American bank troubles, and conflicts like the Israel HAMAS, if the BSE Index could so well, it’s not far-fetched to think that the Sensex does have the potential to nearly double in the next five years, possibly hitting the 1 lakh mark..
Wondering how? Well, let’s get the math from the Sensex bull run in the past 5 years
In May 2019, when exit polls hinted at Narendra Modi’s government returning to power, the Sensex reached a record high of 39,352.
Then, on September 20, 2019, there was another leap of 2.83% when the Finance Minister slashed domestic companies’ tax rates from 30% to 22%.
Although during the Covid-19 pandemic, the Sensex dipped to 27,500, it is worth noting that it made a remarkable comeback post October 2020 – and what a bullish run it was!
The year 2021 was huge for the stock market, with the Sensex rising from 48,000 straight up to 58,000. And a peak point of 61,305 (recorded on) October 14, 2021.
2022 didn’t bring anything particularly noteworthy, but in 2023, the Sensex did reach a gigantic 67,000.
What fueled this bull run?
- Nifty Midcap and Smallcap indices saw impressive jumps of 17% and 20%.
- Monetary policy tightening.
- Foreign Institutional Investor (FII) inflow.
- Lower-than-anticipated US Consumer Price Index (CPI) numbers.
Now, which companies stood out as leaders during these five years?
Multibagger Stock #1 – Ruchi Soya Industries Limited.
Multibagger Stock #2 – Adani Transmission Limited.
Multibagger Stock #3 – Tanla Platforms Limited.
Multibagger Stock #4 – Adani Enterprises Limited.
Multibagger Stock #5 – Deepak Nitrite Limited.
Also Read: Why Adani Shares are Rising in 2022? Should you Buy Adani Stocks in 2022?
Moreover, in 2022 and 2023,
Several Public Sector Undertakings (PSUs) also proved to be multibaggers –
- Power Finance Corporation (PFC),
- SJVN,
- Rural Electrification Corporation (REC),
- Rail Vikas Nigam Ltd (RVNL),
- MMTC Ltd and
- NMDC.
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During the times of Russia-Ukraine conflict, steel and metal companies also performed exceptionally well.
Now, Will Sensex at 1 Lakh Be a Reality? or Is There a Market Crash on the Horizon?
Well, the stock market doesn’t move in a straight line; it operates in waves, with both bullish and bearish phases. Market crashes are part of this cycle, but after each crash, the market tends to rebound and grow even faster. We’ve witnessed the impressive bull run of 2021 following the impact of the COVID-19 pandemic.
So, it’s clear that investors need not be overly alarmed by market crashes. In fact, market crashes can present great opportunities to buy during dips and accumulate stocks.
In conclusion, as we’ve seen before, if the market can nearly double in the past five years, it’s entirely possible for the Sensex to comfortably cross the 1 Lakh point mark in the next five years. However, the ease or difficulty of reaching this milestone and whether it takes five, three, or even seven years will depend on the unfolding events and time itself.
