Are Indian shares cheap or pricey at these levels?

Moneycontrol Bureau

Around 13 times one-year forward price earning (P/E) multiple, the Sensex looks much cheaper than what it was a couple of years back. But it still does not look all that cheap compared to the lows of March 2009 and May 2003. There is no telling where the bottom could lie, and share prices could decline further even after appearing to be cheap in absolute terms. But investors could take comfort in the fact that the forward P/E is below the average of the last 12 years. To that extent, the risk-reward ratio looks reasonable, if not downright attractive.

ritesh.presswala@network18online.com