MSCI India - One Year Rolling Forward PER currently stands at a ~13x. MSCI india's mean PER is close to ~15x. And this mean PER is for the last 10 years. The 2007 rally PER was ~21-22x and the 2008 down turn brought it to as low as ~8x. I remember a famous market analyst saying on TV, i would sell my house and other assets to put money in equities. How i wish ..... Anyways, the chart below provides an amazing insight. MSCI India is trading at one standard deviation below its historic trading average. If technical's are to be believed then the market has great support at this level, baring the stochastic event of 2008. Does this all indicate a level to go long? In my opinion, the answer is yes. Policy inaction, rain deficit, rising fiscal deficit, earning downgrades, interest rate peak, inflation in double digits - everything seems to be factored in. Nifty has been range bound too showing some character in that range. The worse seems to be factored in - except probably a downgrade from the investment grade status. Probably that event can cause a hammering. Funds may exit, and earnings may get revised on account of cost of capital. But certainly these levels look attractive to my eye. Stock specific obviously.
No comments:
Post a Comment