India is getting a lot of attention as a great place for growth among countries that are still developing, says Gustavo Medeiros, the Head of Research at Ashmore Group, a global investment company. For the last year, Ashmore has been careful about investing in Indian stocks, but now they’re looking to invest more. Medeiros told ETNow, “People around the world really like India. It’s one of the most exciting growth stories in developing markets.” He feels that India has become more attractive in the last ten years because of better, pro-business government policies.
Even though Ashmore believes in India’s long-term potential, they reduced their investments recently. “For about a year, we’ve had less exposure to India. In many of our equity portfolios, we have even been underweight in India for the first time in years,” explained Medeiros.
However, after a recent dip in the market, Ashmore has changed its mind and started to buy more Indian stocks again. Medeiros pointed out that strong economies often have higher stock prices. “You can’t find cheap stocks in a strong market. India still has higher prices than other developing countries, but the difference has become smaller after the market correction,” he noted.
Medeiros also talked about two important trends shaping India’s future: bringing more women into the workforce and increasing manufacturing jobs. He stressed the need to find companies that can make the most of these trends, especially in healthcare and household items, where more women working could lead to increased demand.
While Ashmore doesn’t pick individual stocks, they focus on large Indian companies that are priced well. “We are looking for larger companies that aren’t too expensive right now,” he said, mentioning that they are particularly interested in sectors like finance.
With India having strong economic data, good policy support, and favorable demographics, international investors like Ashmore are becoming optimistic about the market again after a short break.
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