It's going to be a slow and difficult recovery but the Indian growth story is just getting stronger. In an interview with CNBC-TV18's Avni Raja, Manisha Girotra, CEO and Country Head of UBS spoke about the much talked about double dip, and the Indian markets.
It's going to be a slow and difficult recovery but the Indian growth story is just getting stronger. That's the view coming in from UBS.
In an interview with CNBC-TV18's Avni Raja, Manisha Girotra, CEO and Country Head of UBS spoke about the much talked about double dip, and the Indian markets.
Below is a verbatim transcript. Also watch the accompanying video.
Q: Is the much talked about double dip recession could in fact be a reality?
A: I think while generally the world is divided in its opinion whether itís a double dip or a slow recovery and growth, we tend to stay more towards slow recovery in the next 12 to 18 months. Itís going to be a painful process. But we as a firm donít see it as a double dip.
Q: And what about the Sensex? The Indian markets currently, what is your view on that? Do you see an upward trend?
A: I think basically what we are seeing is new investors coming in, new FIIís coming in, in the last few months. The Indian growth story has become so compelling that itís making investors find it very hard to leave, not invest in India. So as a result we are seeing more and more liquidity rush into the country. I think for the next 6 to 8 months we remain bullish on the Sensex and I think you will see some upward trend.
Q: As far as the credit policy is concerned, what is your view on that and do you see a further upward trend in the interest rates?
A: If your question is for the next few months, we donít see another upward revision. I think for the next few months we see a benign credit policy.
Q: What is your outlook on the power sector especially the renewable energy sector?
A: Very positive. That's a sector that from what I hear from my clients on the investing side is one that they feel most bullish on. In the earlier years, you saw telecom, you saw real estate. But I think the sector that investors are very excited on because they feel it's the next telecom sector for India, the next infrastructure sector that will play out is power. So it remains very positive and you will see that through valuations and the performances of the company hopefully.
Q: What is your view on the valuations currently in India, how does that look?
A: Compared to other emerging markets we look pretty rich. We are about 17 to 18 times while the other emerging markets are at about 7 to 8 or maybe 10 times in certain cases. But the growth and the scale that India offers, very few other countries offer. That's really why you see more and more new funds coming in to invest in India.
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