The nation’s long, hard journey

[Value Research Editor's Note]( 8th June, 2024 --------------------------------------------------------------- Dear {NAME}, Every Saturday, I share my perspective on a topic investors need to understand. This week, let’s look at why the election result is favourable… A long, hard journey Up front, let me say something that those familiar with my views would probably not expect: The stock market’s initial reaction to the election results on June 4th was justified. Normally, when the markets fall sharply, I warn my readers against knee-jerk reactions. If your investments are well-chosen and carefully monitored then most sudden market crashes are nothing but buying opportunities. Most crashes, but not all. There can be crashes that are a legitimate reaction to an external event that will damage the basic premise on which the direction and the level of many stocks are based. There is, of course, an element of the knee-jerk reaction, but events with genuinely bad long-term outcomes can also happen. Let me first take you back a decade to the morning of May 17th, 2014. That day, I wrote a hurried article on Value Research Online titled [“Good Morning, India”](. Within the articles were these lines: “...at this point, there is no shortage of those who seem to be hoping that Modi will fail and India will sink back into a morass of despair. It's hardly a secret now that this breed of people dominates TV studios and other media in Delhi. Fortunately, at this point, they look like the jackals that howl in the jungle when a lion or a tiger is nearby. Over the next five years, India will face a lot of opposition from these people, but I'm sure that over time, their self-importance will wither, as will their numbers. It's a new morning in India, the end of governments whose only job seems to be to survive, no matter the damage to the country. We have moved on to a real government, an experience that only some of us have had…” It’s interesting to see what these ten years have been like compared to what I thought would happen. The good things that were on the horizon turned out to be much, much bigger. The past ten years have been a remarkable journey, filled with both highs and lows. There have been moments of doubt as well as times of great joy. Those who see the glass as half empty can point out numerous issues in the economy and business sector, many of which are legitimate concerns. As equity investors, we are acutely aware of these challenges. However, what truly matters is not just where we stand at this moment but where we have been and where we are heading. In a long and arduous journey, it is often more beneficial to periodically look back and appreciate how far we have come rather than focus solely on the remaining distance and feel overwhelmed. This is a common experience for people who start investing with a significant financial goal. After some time, reflecting on the progress can provide a sense of achievement. It’s the same for the nation’s progress. A decade ago, I could hardly have imagined the extent of progress that would be made in terms of addressing past issues and laying the groundwork for future growth. From the implementation of GST and the cleanup of bank NPAs to the introduction of bankruptcy laws and measures against tax evasion, and above all, the incredible infra buildup, each challenge in the economy has been tackled in a way that seems unbelievable from the perspective of 2014. However, the flipside of what I wrote in 2014 has also proved to be much sharper than what I’d thought it would be. The nation and the economy have grown, and the hunger to repeat the drift and the loot of 2004-2014 has grown among the usual suspects. As the chicken has grown and become plump, the knives of those waiting to slaughter it have become sharper. Even though the path forward is tougher than it should have been, it’s not impossible and must be walked upon with resolve. Thank you for being a Value Research Insider. I hope you found this note useful and interesting. What did you think of today’s note? [Let me know](mailto:dhirendra@valueresearch.in). If you know anyone who would enjoy it, please forward this email. They can sign up for free [here](. You can also subscribe to the Hindi version [here](. [vro-logo]( Copyright © Value Research India Private Limited 2024. All rights reserved. C-103, Sector 65 Noida, 201301. [Manage Newsletters]( [Unsubscribe]( [Privacy Policy]( Follow us [twitter-icon]( [facebook-icon]( [youtube-icon]( [linkedIn-icon]( [instagram-icon](