India Holds Great Investment Opportunities in Emerging Markets: Mark Mobius

India Holds Great Investment Opportunities

Veteran investor Mark Mobius, renowned for his work at Mobius Capital Partners, has expressed his strong belief in India as a prime destination for emerging markets (EM) investing. Mobius emphasized that reducing India’s weightage in investment portfolios doesn’t make sense, given the country’s vast potential for terrific investment opportunities. Currently managing nearly $300 million in assets across various countries, Mobius underscored that India should be the primary choice for global investors interested in emerging markets.

Mobius’ Increasing Exposure to India

Mark Mobius disclosed that his current exposure to India stands at 20%, which is at least double the 5-10% exposure he historically maintained. He remains optimistic about India’s resilience in the face of macroeconomic changes occurring worldwide. Despite the global markets, including the US, responding unfavorably to the US Federal Reserve’s projection of another rate hike, Mobius believes that the interest rate cycle is approaching its peak, and the Fed is unlikely to raise rates further.

Challenges Faced by Indian Equities

Indian equities have confronted several challenges in recent months, including record-high US bond yields, a stronger US dollar, and soaring crude oil prices. These factors have prompted foreign investors to engage in selling Indian stocks since August 2023. The persistent selling pressure continues to impact the Indian market.

Positive Long-term Outlook for India

Mark Mobius remains bullish on India’s long-term prospects, citing favorable macroeconomic factors such as demographics and the growth potential of specific companies. In the technology and digitization sector, Mobius has expressed particular interest in companies like APL Apollo Tubes Ltd., Metropolis Healthcare Ltd., Persistent Systems Ltd., CE Info Systems Ltd., and Dreamfolks Services Ltd. He believes that China’s growth is unlikely to match its past levels, making India a more attractive investment destination in the long run.

Indian Stock Market Performance

The Indian stock markets have experienced both highs and lows in September. The Nifty 50 index briefly crossed the 20,000 mark before undergoing a correction phase. However, the benchmark index has registered nearly a 10% increase for the year and is on track to achieve its eighth consecutive year of positive returns. In September, the Nifty 50 emerged as the top-performing index globally, showcasing India’s resilience and growth potential.

Sensex Rebounds on Positive Trends

Domestic equity benchmark Sensex rebounded from early losses, closing higher by 173 points on Wednesday. This rebound was driven by buying in companies like Reliance Industries, Larsen & Toubro, and ITC, coupled with positive trends in Asian and European markets. The Sensex settled at 66,118.69, with 20 of its components ending in the green.

The Nifty also gained 51.75 points to close at 19,716.45, with its performance in September positioning it as the top-performing index globally for the month.