Top Sectors to Watch in 2023

Find out what the top sectors to watch for in 2023 are with Research 360 and how to best capitalize on their potential. We'll explore the hottest areas in the financial markets, what to look for when investing, and how to make the most of your portfolio.
27 Sep, 2023 13:12pm
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Based on market conditions and the general economy, some stock market sectors may perform better than the others. Check out the top sectors to watch in 2023. 

Sector analysis is an excellent strategy for beginners as well as seasoned investors who wish to pick stocks that may deliver strong returns over the long term. If you want to focus on investing in the stock market this year, or if you want to rejig your portfolio and include stocks from promising sectors, it can help to keep an eye out for interesting sector trends in 2023. 

Some market segments, like the financial services sector, may be value sectors that include stocks trading below their true value. Others, like the healthcare and online retailing sectors, may be growth segments that have the potential to outperform the average market. Let’s take a closer look at the top value and growth sectors in 2023. 

Cement

One of the top industries or sectors to follow this year is the cement segment. Cement’s demand primarily stems from two key sectors — real estate and infrastructure. With both these sectors showing promising development in recent years, the demand for cement has been on an upward trajectory. This could bode well for the cement industry in the stock market too. 

Examples of cement stocks in India: UltraTech Cements and Ambuja Cements

Defence 

In the Union Budget 2023, the Indian government allocated Rs. 5.94 lakh crores to the defence sector. This was 13% higher than the previous year’s allocation, clearly putting the sector in the spotlight in 2023. The Indian government has also recently signed various defence deals amounting to over Rs. 36,400 crores. These developments all make the sector one to watch out for.

Examples of defence stocks in India: Hindustan Aeronautics and Bharat Electronics 

Infrastructure 

The Union Budget 2023 also prioritised India’s infrastructure sector, with particular focus on housing affordability, building smart cities and improving air connectivity. Overall, Rs. 10,000 crores were allocated for urban infrastructural development. These announcements and allocations have made infrastructure another important contender for the top sector trends in 2023. 

Examples of infrastructure stocks in India: Larsen & Toubro and Reliance Infrastructure 

Automobiles

India’s automobile and automotive sector also holds great promise according to experts. In FY24, analysts expect the sector will register a sales growth of 7% to 9%. Furthermore, with electric vehicles becoming the talk of the town, all eyes are on the automobile sector and its pivotal role in the transition to a sustainable future. 

Examples of automobiles stocks in India: Tata Motors and Ashok Leyland 

Information Technology 

Information technology is no longer the future; it is what drives development in the current day and age. Needless to say, the IT industry has been one of the top growth sectors in 2023. Technology has already revolutionised various other sectors like banking, insurance, and retail, among others. Furthermore, the rise of artificial intelligence and machine learning has further cemented the IT sector’s position among the top market segments to focus on. 

Examples of IT stocks in India: Infosys and Wipro 

Conclusion 

The bottom line is that the market outlook for the sectors mentioned above apparently appears optimistic. So, these are some industries and sectors to follow if you want to rebalance your portfolio this year. That said, it is always advisable to perform your own research and identify the 2023 sector trends to watch out for. This will make it easy for you to identify the promising value sectors and growth sectors in 2023, so you can create an investment plan involving such sectors and market segments.

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