Siddharth Mehta of Bay Capital Keep a Close Eye on Digitally Driven Indian Economy

The rise in internet penetration along with low-cost smartphone assemble a strong digitized economy that attract Siddharth Mehta of Bay Capital to invest in it. In term of investing in emerging Indian economy, former IL&FS Director Siddharth Mehta expressing his point view that the implications of such businesses for investors are profound.

The nature and composition of the economy and financial markets are likely to be very different about ten years from now. As investors, we continue to be extremely bullish on India and particularly the large, dominant consumer internet businesses, many of which are likely to be listed over the next 12- 18 months. While there will inevitably be businesses that will falter and not be able to scale up rapidly, for discerning investors who are able to take a longer view, the opportunities are significant.

The government of India push the digitization from past few years but the really implication has done during the pandemic. The pandemic effect has accelerated the usage of the internet as well as smartphones. From education to earning, every platform acquires digitally driven channels that impacted the growth of digitization positively in India. According to a data there are 758 million internet users in India, with about 700 million smartphones. It is not just enough the data also claimed that India is the highest data consumer in the world that is 13.5 GB per user per month.

IL&FS Former Director Siddharth Mehta does not decide overnight to invest in Indian economy he observes the market growth very closely and see the optimistic surge in the market. He says, “over the last 5 years, policy interventions along with the Jio phenomenon have accelerated India’s journey in digitization and over the next decade and more, we see the internet or digital ecosystem becoming a much larger part of the Indian economy”.

The expeditious evolution in the digitization has grab the attention of Mr. Siddharth Mehta at Bay Capitalto invest-in but he also advices the new investors and emerging business owner about investing in digitally driven Indian economy. He addresses all the new investors and said “our advice to investors would be to remember that the collective resolve of humankind is unparalleled. Despite the near-term outlook being cloudy in India due to the second wave of the pandemic, we do believe that things will start to improve over the next 6-8 weeks”. And his presumption of 6-8 weeks of wait to improve the situation actually works as the Indian government declared the online booking of vaccination slot of antivirus dose that thrilled Indian public owing the Internet platform to book their slot.  this really a masterstroke to involve all those citizens of the nation that is derived from the digital world in the first wave of COVID-19.

Further adding to his word while addressing the future investors and business owner Mr. Siddharth Mehta said “As investors, one should have a 5-year view and own businesses which will be beneficiaries of many of the themes that are accelerating as a result of the pandemic. Moreover, we are likely to see many businesses from the internet or digital space getting listed over the next 12 to 24 months and these will be very interesting businesses to focus on (selectively) and own for a long-term oriented investor”.

One of the most significant opportunities in the Indian internet space is the emergence of the next billion users (NBU). It’s safe to say that the next lot of internet users in India are going to be very different from the past. These new users are likely to be from the smaller cities and towns.  Therefore, the 3 Vs – Voice (60 per cent of internet users interact via voice assistants), Video and Vernacular are going to be significant drivers of value accretion. Businesses that recognize and tap into this opportunity are likely to be outsized gainers.

Mr. Siddharth Mehta at Bay Capital said that the main drivers of the India narrative, notably the demographic advantage, the fact that we are approaching $2,000 per capita income, which has historically proven to be an inflection point for many countries, and India's accelerating financialization and urbanization, excite us as investors.

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