Which Indian Stocks Will Gain During Donald Trump Presidency?

Although Trump wants to promote US-based businesses, it will be difficult to match the cost-efficiency of Asian manufacturing hubs

In his second term as the President of the United States, Donald Trump has made some major decisions. The focus is apparently on making America great again. Trump wants global businesses to invest and manufacture in the United States. If this is not done, Trump has warned to impose heavy taxes on imported goods and services.

Such developments have rattled many global economies that rely on exports to the United States. However, things are expected to cool down in the coming months. In a practical sense, the existing collaborations with Asian manufacturers and service providers is likely to be maintained. That in turn presents opportunities for several businesses in India. If you are worried about your investments, let us take a look at which Indian stocks will gain during Trump’s second term as President.

Technology and IT services stocks – Trump wants to provide a boost to the US economy and enhance consumer and corporate spending. To make that possible, the Trump administration is expected to announce some major tax cuts and deregulation policies in the near future. With more funds at their disposal, US-based businesses will allocate more towards spending on technology upgrades. That in turn will benefit Indian technology and IT services companies. Leading IT companies like TCS, Infosys, Wipro and even other small to medium IT companies will also benefit. Stock of these companies may rise during Trump’s Presidency.

Defense stocks – Under Trump’s administration, the defense relations between India and the United States are set to improve. It is likely to result in increased investment and collaboration in the defense sector. While the US will focus on developing defense technology, India could be used as a manufacturing hub. This collaboration can benefit Indian defense companies such as Hindustan Aeronautics Limited (HAL), Bharat Electronics Limited (BEL), Bharat Dynamics, Cochin Shipyard, Mazagon Dock Shipbuilders, etc.

Pharmaceutical – While Trump wants businesses to Make In America, there is also the need to reduce inflation in the United States. Indian pharmaceutical companies offer significant cost advantages in comparison to medicines manufactured in the United States. So, even with the potential risk of higher tariffs, Indian pharmaceutical companies may continue to thrive during the Trump era. It is nearly impossible to shift all the world’s manufacturing to the United States in a short period of time. Some Indian pharma stocks that are expected to gain during Trump’s presidency include Fortis healthcare, Sun Pharmaceutical, Abbott India, Cipla, Dr. Reddy’s Laboratories and Zydus Lifesciences.

As is evident, there are plenty of Indian stocks that can gain during Trump’s second term as the US President. Indian stocks that have minimal exposure to the US market are also likely to be a safe bet. It is recommended that you do your own research before investing in any stocks.