India Fund

India’s alpha among emerging markets set to continue

Date: 30th Nov 2021 | Publication: Ausbiz

When it comes to the performance of major emerging market equities this year, the divergence between China and India has been stark. Chinese markets have struggled while those in India have soared. India Avenue Investment Management’s Munguthan Siva expects the trend will continue, noting that even after the strong run we’ve seen, corporate earnings continue to impress. He says strong growth in the technology sector, a steady recovery in loan growth and asset quality across most private sector banks, a pickup in economic activity after the devastating Delta variant wave and higher commodity prices have all contributed to annual profit growth of 40-50%. Looking ahead, Munguthan says he’s looking for businesses who can gain market share during periods of turmoil, allowing them to boost their brand, management and underlying growth over the longer-term. He gives his tips on the sectors likely to outperform next year, along with the outlook for interest rates and the Indian rupee.

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