Wharton-India Economic Forum, every year policymakers, fund managers and industry experts come together in Philadelphia to discuss India. The theme for this year's conference is India gaining momentum.
The India story has been discussed debated and deconstructed at conferences the world over for years now. But at the Wharton India Economic Forum, the discourse seems to have shifted from unbridled exuberance about the strength of India's economy to the humps it faces to achieve double digit growth. While investors, entrepreneurs and policymakers continue to cheer for India, the dreaded inflation monster have them buried. CNBC-TV18's Malvika Jain spoke to some of the biggest names in the world of finance, some very inspiring entrepreneurs and decision makers. Jain: With inflation peaking at 8.98% in March and hardening rate cycle, is foreign capital finding a better attractive destinations? Punita Kumar Sinha, Senior Managing Direction, The Blackstone Group: No, I don't think they are overvalued. If you look at the historic range or valuations, India is trading in the middle of its range. Right now, we are in the earning season. So, the companies that are disappointing on earnings are getting punished quite a bit. I think that's because the market is factoring in about 17-18% earnings growth, so we need to see that kind of growth come through. Also read: Sensex may slump to 16k by June end, says Ambit Jain: In comparison to the US, there is a very high interest rate differential in India. So, in view of that, do you see that the foreign institutional investor (FII) investments and inflows will continue? Sinha: If you look at real interest rates in India, they are not higher because inflation is running so high. So, in that sense, the real interest rate differential isn't much at all. Jain: Do you think that the Indian stock markets are overvalued? Steven Wisch, Founder & Managing Partner, India Equity Partners: I think Indian stocks markets are always pricy. But India has tremendous potential and its one of the few places in the world where you see companies that are growing 25-35% or more earnings per year. So, while with inflation high and interest rates high it looks pricy, I think for the longer-term it's not unreasonable. So, I think they will raise rates more, probably another 50-150 bps. The Indian markets still hold promise, though they have been gyrating to global cues. Investors know to be part of the party they need to stomach wild volatility. Unlike the Indian markets India's gross domestic product (GDP) growth is less volatile and perhaps more predictable. While there is scepticism about the government achieving its target of 9-9.5% GDP growth, most economists believe it is doable. Roopa Kudva, Regon Head South Asia, S&PDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
