Unlocking the Potential: Sensex on the Path to 1 Lakh

Have you ever wondered when the BSE Sensex will hit the elusive 1 lakh mark? Well, according to a recent report by Economic Times, it might just happen by December 2025. The Sensex, India’s premier equity index, has been on a remarkable growth trajectory, with a historical compounded annual growth rate (CAGR) of 15.9% over the past 45 years.

From its humble beginnings with a base value of 100 in April 1979, the Sensex has soared to incredible heights, experiencing an 800-fold increase over the years. If it continues to grow at its current rate of 15.9% per annum, the Sensex could potentially reach the 1-lakh milestone by the end of next year.

However, this projection does not take into account the dividends declared by Sensex constituents, which investors may choose to reinvest in the market. In the short term, factors like the Budget, the Fed’s rate cut trajectory, and the US Presidential elections may influence the Sensex’s trajectory. But looking ahead, the long-term growth story seems intact despite any short-term fluctuations.

Sensex at 1 lakh?

Since its launch on January 1, 1986, the Sensex has only recorded six instances of negative returns since 1996. In the last five years alone, the index has doubled in value, surpassing the 40,000 mark.

Raamdeo Agrawal, a seasoned Dalal Street veteran and co-founder of Motilal Oswal Financial Services, has been closely monitoring the Sensex’s growth since its inception. According to his calculations, if the Sensex continues to double every five years, it could potentially reach 1.5 lakh by 2029.

Renowned emerging markets investor Mark Mobius is also optimistic about India’s growth prospects. He believes that if India sustains a 7% growth rate and companies grow at 14-15%, the Sensex will also rise at a similar pace over the next decade. In an interview, he expressed confidence in India’s upward trajectory towards the 1 lakh mark, possibly even before the projected timeline.

With experts projecting a bullish outlook for the Sensex’s future, reaching the 1 lakh milestone seems like a tangible goal on the horizon. As investors keep a close watch on market trends and economic developments, the journey towards the 1 lakh mark promises to be an exciting ride filled with opportunities and potential rewards.