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 As the stock markets reach record high amid a surge in new investments and GDP forecast to grow at 7 per cent for FY25, the Indian economy is entering a ‘Goldilocks period’ amid ideal conditions for growth and profitability, according to an ace global expert. 

According to Kenneth Andrade of Old Bridge Mutual Fund, there are ideal conditions for growth in the Indian economy amid strong fundamentals across parameters.

In a report, Andrade provided a cautious yet optimistic outlook on various sectors, saying infrastructure, IT and select segments within chemicals and real estate are areas of interest.

Painting a robust economic environment, the report said corporate capacity utilisation is nearing 90 per cent, a strong indicator of healthy profitability growth for the current financial year.

“Investors should align with growth businesses rather than seeking undervalued opportunities, which are scarce,” it mentioned.

The Old Bridge Mutual Fund report emphasised the importance of aligning with growth businesses and being patient for opportunities to invest at attractive valuations.

According to the Reserve Bank of India (RBI), the second quarter of 2024-25 has begun with signs of quickening momentum in the Indian economy as an improvement in the outlook for agriculture and the revival of rural spending have turned out to be the bright spots in the evolution of demand conditions.

With rural spending outpacing urban segments, the rural-urban divide is narrowing, as the recent monthly per capita consumption expenditure (MPCE) survey of the NSSO highlights.

Manufacturing is a key pillar of the drive towards achieving higher levels of development, with its share needing to reach 20-25 per cent of GDP in order to establish India as a global manufacturing hub.

Meanwhile, the International Monetary Fund (IMF) has raised India's GDP growth forecast for 2024-25 to 7 per cent from 6.8 per cent predicted earlier on the back of “improving private consumption, particularly in rural India".

The IMF has left its estimate for India’s economic growth for 2025-26 unchanged at 6.5 per cent.

Leading industry chamber FICCI has also projected an annual median GDP growth forecast for 2024-25 at 7 per cent.