Investor interest in India has grown steadily over the past year as its economy grows, its population surges and its stock market surges. But a pullback at the end of 2024 has left market participants divided on whether to continue investing. Malcolm Dorson, senior portfolio manager at Global X ETF, remains bullish on the country. “Broadly speaking, India is a compounding machine, and we view the recent pullback as a unique opportunity to get firmly into high-quality stocks,” Dorson, who manages the Global The parent company, Mirae Asset, is one of India’s largest foreign asset management companies. .NSEI 1Y mountain Nifty 50 His comments came after a tough period for Indian stocks, with the benchmark Nifty 50 index and the BSE Sensex index, which represents the 30 largest and most traded companies on India’s Bombay Stock Exchange, down 8.4%. , up 7.3% respectively in the last quarter of 2024. In comparison, the U.S. benchmark S&P 500 index rose 23.31% in 2024. is Shriram Finance, formerly known as Shriram Finance Shriram Transport Finance is a non-bank lender that provides loans to individuals and small businesses. The portfolio manager explained that about 90% of the loans it makes are “against sustainably profitable assets” – assets that generate a steady income stream – and about 95% are secured. What really sets the company apart, Dotson said, is the scale of its app and its broad user base of more than 10 million. He also likes the company’s practice of recruiting employees between the ages of 21 and 25 and training and promoting only within the organization. Shares of Shriram Finance, which is listed on the National Stock Exchange of India, are up about 50% in the past 12 months. All 37 analysts covering the stock have a buy or overweight rating, with an average price target of 3,686.71 Indian rupees ($43), according to FactSet data. This gives it ~20% upside potential. General Insurance Company of India Another company that Dotson is bullish on is reinsurer General Insurance Company of India (GICRE). Portfolio managers particularly like the reinsurance business model and GICRE “because it is a way of investing premiums paid by policyholders before claims are paid”. “This ‘float’ creates opportunities to drive growth,” he added. Dorson also expects GICRE and other insurance companies in India to benefit from lower taxes on life and health insurance premiums. GICRE’s shares, which are listed on the National Stock Exchange of India and the Bombay Stock Exchange, have gained about 45% in the past 12 months. Two of the three analysts cited by FactSet who cover the stock have sell ratings on the stock. Their average price target gives it 25% downside potential. Reliance Industries Elsewhere in India, Dolson is betting on Reliance Industries, a conglomerate that spans energy, petrochemicals, entertainment and telecoms. The portfolio manager said the company, run by India’s richest man Mukesh Ambani, has a renewed focus on digital and is investing in “a large-scale digital backbone to support mobile and digital data consumers in the long term.” change”. Dorson pointed out that Reliance hopes to double the revenue and EBITDA (earnings before interest, taxes, depreciation, and amortization) of its retail and digital business units in the next three to four years. Dorson also noted that Reliance’s telecom company Jio and some of its other retail businesses “will be among the most closely watched market activities by foreign institutional investors and domestic investors.” Reliance’s shares trade on the National Stock Exchange of India and the Bombay Stock Exchange The stock has fallen about 4% in the past 12 months. Of the 37 analysts covering the stock, 85% have a buy or overweight rating, according to FactSet data. Analysts’ average price target is INR 1,589.69, which represents an upside potential of 28%.
Portfolio managers earmark 3 Indian stocks to buy in 2025 | Real Time Headlines
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