Back up the truck on Indian equities
The way I look at it is: either the (financial) world is coming to an end - or not.
- If the former, then your investment strategy doesn’t matter - everything’s going to 0.
- But if the latter, then this is a very good time to load up on Indian equities.
Consider:
- Indian indices are back to March 2006 levels. You can buy Indian stocks for the same prices as 2.5 years ago, despite all the growth we’ve had during that period.
- The Nifty is trading at a trailing P/E of 14. Levels of 12 & below have marked long-term bottoms, while levels of 14 & below have resulted in double-digit gains over the succeeding 6, 12 & 36 month periods.
- The Nifty Midcap-50 is now trading at a P/E of 7.8; yes, there will be a slowdown in revenues, perhaps even negative EPS growth in 2009, but even so, these are good levels to buy the mid-caps.
- Interest rates have peaked, as has inflation.
- And of course, on a technical basis, we’re way oversold. But then, we’ve been so since the Nifty dropped to 3600.
I say this is the time to be greedy & buy a boat-load of Indian equities - both right away to trade a bounce, and then over the next few months as longer term investments.
Yes, I’m long! 
More on this topic
(What's this?)
SOS Trade: Cover 400 Nifty Call
(The Indian Investor's Blog, 10/6/08)
SOS Update: Up 10.37%
(The Indian Investor's Blog, 10/10/08)
Who Said the Real Estate Market was Dead?
(The Wild Investor, 6/26/08)
Is thrift making a comeback?
(Option ARMageddon, 12/26/08)
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