According to Adrian Mowat of JP Morgan the new government has done a lot of good things at an executive level and the house is particularly excited about the proposal about managing food inflation.
Adrian Mowat, Chief Asian & Emerging Equity Strategist, JPMorgan says India looks extremely favourable moving in FY15, and believes it would be an outperformer in FY16.
According to him the new government has done a lot of good things at an executive level and the house is particularly excited about the proposal of managing food inflation.
However, one would be keenly watching for government’s decision on energy prices like coal, gas which would impact power generation. The house is also eagerly awaiting announcement of diesel deregulation, he said.
Although fears of interest rate hike could have triggered a sell-off in US, he believes Fed is likely to delay hiking. If diesel prices cool-off they could bring in an improvement in economic data, he feels.
Globally, he is bearish on commodities and advices being underweight on that space. He is particularly underweight on petrochemical and steel companies in Taiwan and is also relatively bearish on Chinese growth.
Structurally, he is bearish on crude oil but thinks low crude oil prices would bode well for India per se.
Also read: India best story among EMs; prefer cyclicals: JP Morgan
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