India good investment option
Foreign institutional investors continue to pump money in the Indian equity market despite poor Q3 earnings because it is the only good investing opportunity currently. There are too many geo-political risks across the world and the only bright spot right now is the US apart from India that due to its demographics and growth stands out in the emerging market basket. Pradhan says the Union Budget to be announced by Finance Minister Arun Jaitley will be very closely watched by FIIs who are hoping to see some significant change in Indian business environment.
See 15-16% earnings growth in 2 yrs; remain overweight on India
Global investors, will be focusing on fiscal deficit of India and whether it can be reigned within 3.5-4 percent of GDP, structural reforms once again focusing on the fiscal side and significant increases in infrastructure spending. "What's important is the trajectory of fiscal deficit and whether it is coming down… As long as it is lower than 4 percent of GDP, the market will not be too worried," and Investors will remains overweight on India. The valuations should be high as the expected earnings growth to be 15-16 percent in dollar terms in two years. Earnings growth continues to remain a challenge for many emerging markets, further justifying the high valuations in India. The Reserve Bank will likely lower rates by 100 basis points this year. Economic growth and interest rates cut will ensure that the balance sheet of banks doesn’t decline.
Bullish on Banks, Metals, Auto and Infra going forward.
Happy Investing
Source : Moneycontrol.com
Foreign institutional investors continue to pump money in the Indian equity market despite poor Q3 earnings because it is the only good investing opportunity currently. There are too many geo-political risks across the world and the only bright spot right now is the US apart from India that due to its demographics and growth stands out in the emerging market basket. Pradhan says the Union Budget to be announced by Finance Minister Arun Jaitley will be very closely watched by FIIs who are hoping to see some significant change in Indian business environment.
See 15-16% earnings growth in 2 yrs; remain overweight on India
Global investors, will be focusing on fiscal deficit of India and whether it can be reigned within 3.5-4 percent of GDP, structural reforms once again focusing on the fiscal side and significant increases in infrastructure spending. "What's important is the trajectory of fiscal deficit and whether it is coming down… As long as it is lower than 4 percent of GDP, the market will not be too worried," and Investors will remains overweight on India. The valuations should be high as the expected earnings growth to be 15-16 percent in dollar terms in two years. Earnings growth continues to remain a challenge for many emerging markets, further justifying the high valuations in India. The Reserve Bank will likely lower rates by 100 basis points this year. Economic growth and interest rates cut will ensure that the balance sheet of banks doesn’t decline.
Bullish on Banks, Metals, Auto and Infra going forward.
Happy Investing
Source : Moneycontrol.com
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