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The World’s Fastest Indian (Economy)

Watch the video with Andrew Stotz or read a summary of the country profile on India.

Four Pillars of GDP: Heavy Private Consumption

Normally used to sitting in China’s shadow, India has recently surpassed its cousin to become the fastest growing economy in Asia. This is mainly the result of heavy private consumption, but government consumption growth has also helped. Investment is the one segment that has slowed,  down -0.67 in contribution to GDP growth compared to +1.36 during the second quarter of 2016. Net exports, which were down in the second quarter, rose in the third quarter.

Highest Earnings Growth in Asia

Consensus earnings estimates are expected to grow at the fastest pace in Asia in 2017, and return on equity next year is expected to be the second highest. These stats are mirrored, however, in a much pricier valuation.

The World's Fastest #Indian (#Economy)

A. Stotz Four Elements: India’s rank relative to Asia

Overall, India is moderately attractive in Asia considering all our four elements: Fundamentals, Valuation, Momentum, and Risk.

Fundamentals: ROE is second highest in Asia at 15.9% expected in 2017.

Valuation: India’s stock market has the highest forward valuation in Asia.

Momentum: The market has a strong earnings momentum but poor price momentum.

Risk: The market has a moderate beta compared to Asia ex-Japan.

Strong performance in Energy and Telecoms

Top 3 largest sectors: Financials: 20% of the market. Consumer Discretionary: 12%. Materials: 12%.

Best sector & stock: Energy: +6.4% & Cairn India: +26%

Worst sector & stock: Real Estate: -11.8% & DLF: -26.3%

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DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article.