homemarket NewsSee interesting prospects in India from a medium term perspective, says James Sullivan
See interesting prospects in India from a medium-term perspective, says James Sullivan
James Sullivan, MD-Asia Pacific Equity Research at JPMorgan, sees interesting prospects in India from a medium-term perspective. He believes that the India to China rotation trade is in its last leg and that there are opportunities to be found in the market. He is positive about the banking system in India, and he sees it as a sector with potential for growth. However, he also notes that investors need to be cautious and mindful of the risks involved.
Indian equity benchmarks BSE Sensex and NSE Nifty 50 opened lower on Thursday mirroring global cues. Credit Suisse stock plummeted 30 percent on Wednesday, triggering a selloff across global markets. Metal and IT shares led the headline indices lower.
In a recent interview with CNBC-TV18, James Sullivan, MD-Asia Pacific Equity Research at JPMorgan, discussed the current state of the Indian market and shared his insights on the opportunities and challenges facing investors.
Sullivan stated that he sees interesting prospects in India from a medium-term perspective. He added that the Indian market has been relatively flat in recent months, with valuations remaining high, but he believes that there are still opportunities to be found.
“From the medium-term perspective, we still do very interesting prospects for India,” he said.
Sullivan also stated that "India to China rotation trade" is in its last leg. For those unfamiliar with the term, the India to China rotation trade refers to a trend that has been observed in recent years, whereby investors have been shifting their investments from India to China.
“What we saw late last year and earlier this year was a very significant country rotation trade out of India into China as people started to play that China reopening trade. China had gotten very inexpensive from the valuation perspective,” he explained.
Sullivan explained that he had gone neutral on India due to high FII ownership and valuations.
“India had become extremely well held particularly by foreign institutional investors, had become reasonably expensive particularly in the light of a higher interest rate environment and we had gone neutral on the Indian market on the expectation that we will see a pause in market performance given the fact that most investors are already exposed to the market,” he said.
He pointed out that the Indian government has been taking steps to boost the economy, including measures such as tax reforms and infrastructure investments.
Sullivan also shared his views on the banking system in India, stating that he is positive about its prospects. He explained that the Indian banking system has been going through a difficult phase in recent years, with a high level of non-performing assets (NPAs). However, he believes that the worst is now over, and the banking system is on the road to recovery.
“If you look at the broader banking system as a whole, it is important to differentiate idiosyncratic risks from broader systemic risks. We are not currently seeing systemic risks to the global financial system, and so we are not necessarily sounding alarm bells from that perspective,” he said.
For more details, watch the accompanying video
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
BJP is planning to ban RSS, says Shiv Sena (UBT) chief Uddhav Thackeray
May 18, 2024 8:01 PM
Punjab Lok Sabha elections: Complete list of Congress candidates
May 18, 2024 4:08 PM
Punjab Lok Sabha elections: Check full list of AAP candidates and constituencies
May 18, 2024 12:59 PM
PM Modi, Rahul Gandhi election rallies in Delhi today: Here are the routes to avoid
May 18, 2024 11:28 AM