Lockdowns impede economic activity. In their present form, the impact may be different from the last time. We are heading towards a strategy where economic activity loss can effectively be recouped.

The stock market broadly knows this. This explains why confidence hasn’t ebbed in equities. When we break down and analyse last year’s results into four quarters, an interesting story surfaces. Results are tell-tale of how companies overcome their lockdown losses, how they create savings learning from lockdowns, and how they emerge fighting fitter, leaner and more competitive. Clearly, these crises are opportunities for businesses.

Investors must think differently with every lockdown. During last year’s lockdown, investors who saw the effect of global liquidity did far better than those obsessed with shopping bags of locked down families in supermarkets. The former was not so obvious while the latter was easy to read. Picking the tough ones over the easy and obvious ones is the challenge in every market crisis. While the current lockdown may only be a mini-crisis, it still will have opportunities that are not too obvious but richly rewarding. Learn afresh and invest intelligently during this lockdown. This time is different.

 

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