Upbeat brokerages peg GDP growth at 6% in April-June quarter

Top brokerages Deutsche Bank, Barclays, Nomura, and Religare have raised their growth estimates for the Indian economy for the quarter ended June 30. These brokerages expect India’s gross domestic product ( GDP) to grow 5.6-6% in April-June from the same period a year ago, marking the fastest quarterly growth in nearly two years.

India grew at 4.6% in January-March. The government is expected to release data on GDP growth on August 29.

Economists said uptick in industrial output, revival in consumer discretionary demand, pick-up in manufacturing and transportation sectors, and higher coal, cement and power output growth would have given a boost to economic growth.

“We are also seeing a broad-based revival and expect this momentum to continue as the government is proactively resolving investment backlogs,” said Sonal Varma, economist at Nomura, which is projecting the growth at 5.9%.

Betting on recovery, brokerages have upgraded sectors such as autos and industrials to Overweight. They have chosen banks, consumer discretionary, and oil companies as the most preferred picks.