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In this CIO Viewpoint Equity – India: Foreign investor selling provides buying opportunity, we provide an overview of corporate earnings for the September quarter 2024, explain the reasons for the recent FPI outflows and dive into market valuations. We conclude by analysing high frequency data to gauge growth prospects.

 

Key takeaways:

  • After a long streak of continuous returns, the Indian equity market has undergone a technical correction (>10% drop) since late September this year.
  • This correction has been driven both by domestic factors such as slowing economic indicators, falling earnings growth amidst lofty valuations, as well as due to global factors led by unprecedented foreign portfolio investor outflows, rising U.S. yields and a stronger USD.
  • However, the longer-term India growth story remains intact and large cap valuations have corrected to near historical averages. Foreign investor selling is providing a good entry opportunity for medium- to long-term investors.

 

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The CIO Viewpoint - Equity is available to download below. Please refer to the Important Information at the end of the memo for disclosures and risk warnings.

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