 Bullish on small, midcap banks: Amas BankPublished on Mon, Aug 21, 2006 at 15:49 | Source : Moneycontrol.com Updated at Mon, Aug 21, 2006 at 20:29 15673 Investors following IndusInd Bank. Share this News with them.
According to Amas Bank, American hedge funds are buying Indian stocks. In an exclusive interview with CNBC-TV18, the bank's CIO Francois Bloch said hedge funds are buying midcaps like Syngenta , Indoco Remedies . Bloch said the valuations in India are cheaper and the stocks with PE of 9-12 are being bought. The bank has recently bought Aurobindo Pharma and is bullish on Canara Bank . Bloch reveals that they are bullish on small, midcap banks, which, he says, will be prime targets of funds.
Q: What is your sense of how much liquidity is easing into the emerging markets now, the picture seems to have improved considerably over the last three weeks? A: You are totally right. What we have seen in our bank is that a lot of foreign investors are buying quite heavily into India at the moment based on some fundamentals and also in the view that India is peaking up much more than what was expected two-three months ago. The growth rate is really tempting investors to buy into India, especially American hedge funds, which are some of the biggest in the world, which are, at the moment, buying Indian shares. Q: Any specifics that you have heard in terms of that what sort of money is being raised for India at this point? A: There are lots of American hedge funds, which are buying into India at the moment. We have seen there are keen investors, which are starting to pick up into India because they have seen that there is a lot of growth into India. Just giving one example, which we have seen in another last two-three days is that people buying so-called midcap stocks in India like Syngenta and Indoco Remedies because they have a cheap price earnings versus their peers in America and Europe. I give just an example of Syngenta. Syngenta in Switzerland is a big company trading at PE of 20-21. In India, one can buy at the component at PE of 8-9. If one sees the growth prospectus in India, there is a lot of potential. That's why American hedge funds are buying into India at the moment at a heavy speed. That one can see also from the volume, which is picking up in August versus June and July. Contd on page 2...
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Excerpts from CNBC - TV18's exclusive interview with Francois Bloch:
