Thread by @Equitymaster

5 Underrated Megatrends which are taking shape in India. Our Research Analyst @adityavora89 shares how investors can benefit from them.

#Trend 1: Every Auto Company will be a Tech Company in the future. Did you know that electronic systems accounted for only 5% of a vehicle cost during the 1970s?But since then it jumped to 35% in 2010 as per Deloitte, it's expected to reach 50% of the cost by 2030.

Forget @Tesla. The Ford F-150 has 150 m lines of codes written in its software as per the IEEE blog...and this was back in 2016. I believe this is a big opportunity. Watch out for companies like @MapmyIndia , @tataelxsi , and @quickheal .

#Trend 2:Genome Sequencing: The Future Insurance Policy. The cost of genome sequencing has fallen from US$ 10,000 in 2010 to US$ 1,000 in 2021. Decline of 90% in a decade. It's possible to imagine Amazon selling DIY genome sequencing kits for under US$ 100 in few years.

Now I agree this is an early trend in countries like India. The long-term potential for #diagnosticcompanies and #biotechcompanies is huge. Even R&D companies could be a strong play on future medical tech. Watch out for diagnostic stocks & R&D companies like @SYNGENE.

#Trend 3: Semiconductors: A mobile phone or a consumer appliance or even a vehicle, as the pace of innovation increases, the use of semiconductors will also increase. So why don't we just increase the semiconductor capacity if it's so lucrative? Well, that's the problem.

Making a semiconductor is a 1,500-step process and takes up to 6 months. The amount of R&D involved is massive (14% of revenues). From an investment perspective, while there is no direct play, you should look out for companies offering raw materials to the semiconductor industry

# Trend 4: Gaming is a Serious Business. The gaming addiction in India has just started. We haven't seen anything yet. Surprisingly because of gaming, Disney and Nickelodeon's channel coverage is down 88% and 75% respectively from 2014 levels. However…

E-sports which is electronic sports viewership, has outpaced major sports leagues. The growth in electronic sports is evident from the rise in the prize money. Watch out for #Nazaaratechnologies, the only listed player in the online gaming industry.

#Trend 5: The Focus on Health Will Drive Organic Farming. Bill Gates is the largest private farm land owner in USA. In India, especially urban centers, are increasingly seeing the use of organic vegetables.

The share of the unorganised sector is high. However, organised companies have the advantage of integration from procurement, logistics, and the last mile edge. This is a big opportunity for organised players with strong financial might. Watch out for @TataConsumer .

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Please note that this tweet is for information purposes only. It is not a recommendation or view on any stock.