Week ending 15th July 2023

According to a Goldman Sachs report, India is projected to surpass the United States and become the world's second-largest economy by 2075. The study predicts that India's GDP could reach $88 trillion by 2075, with an average growth rate of 5% over the next five decades.

'Invesco Global Sovereign Asset Management Study' released last week by EY found that India has overtaken China as the most attractive emerging market for investing. The report cited India's improved business environment, structural reforms, and favourable demographics as key factors contributing to its rise in attractiveness.

Another report, this one by the PHD Chamber of Commerce and Industry, projects India to become a $4 trillion economy by the fiscal year 2024-25. The report also projects the per capita nominal GDP to cross $2800 by FY25.

The economic bell weather continue to scale new peaks at 66K last week, supported record high SIP additions of 2.78 million registrations, and FPI inflows crossing Rs. 1.3 lakh cr. However, there are warnings to deal with unlisted space for retail investors as evident?in recent incidents in Reliance Retail, CSK and Ricoh. These examples have clearly demonstrated clearly the need for using PE/VC fund managers to invest in unlisted space.

RBI's recent decision to ask PPI issuers to stop UPI in a co-branding arrangement has put business model of some fintechs like DreamX, Fampay, Akudo, Muvin to discontinue UPI services as they do not hold PPI license. This means that PPI holders can now only be onboarded for UPI by their own PPI issuer. The RBI's decision is likely due to concerns about KYC and money laundering.

Overall, the economic outlook for India is positive, but there are some risks that retail investors should be aware of when investing in unlisted companies, and the FinTech industry will need to adapt to the RBI's new regulation on co-branding PPIs.

Please do read detailed blog with supporting data points >?https://bit.ly/43wVexI?