Renowned emerging markets investor Mark Mobius said that India is increasingly becoming a logical choice for global investors as China's economy slows down. In an interaction with CNBC-TV18 on April 9, he identified potential growth opportunities across various sectors such as infrastructure and PSU firms. Here are four key takeaways from the discussion.
1. Bullish bet on India: Mark Mobius recently highlighted that India is in a position to see momentum in its manufacturing and exports segments amid a slowdown in China. He emphasised that India is increasingly becoming a logical choice for investors globally.
"With China slowing down, India is going to be taking up the slack in terms of manufacturing and exports. So India is in a very good position. There is no question about it," said Mobius adding that India is the top pick when it comes to emerging markets.
Despite the optimistic outlook, Mobius noted that the markets are yet to witness a significant shift in investment flows from China to India. If traders must invest in China, they should look for opportunities in government companies and hi-tech sectors, Mobius said.
2. Investment themes: Mobius expressed confidence in the investment prospects within India's mid- and small-cap companies, identifying them as promising opportunities for investors.
Mobius also shared insights into various sectors poised for growth in India. He emphasised on the potential in infrastructure, particularly in railways and airlines, expecting them to be high-growth sectors. Additionally, he highlighted the importance of closely monitoring public sector undertaking (PSU) companies, especially those operating in infrastructure.
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3. Need for shift to technology hardware: India, which has been doing well in the software segment, now needs to expand the technology hardware sector. "As people want to diversify their supply chain away from China, India can take up that slack considering it has got the population and capability," Mobius said.
Further, Mobius stressed on the necessity for more equity offerings, initial public offerings (IPOs), and listing of government enterprises in the Indian market to fuel growth.
4. On upcoming general elections: When it comes to the upcoming general elections, Mobius predicted increased investments in technology and infrastructure if Prime Minister Narendra Modi is re-elected as the Prime Minister of the country.
Mobius said that Modi has digitised India's economy and brought in many 'firsts' in technology. As Modi becomes stronger politically, it will be seen as good news by investors because it will mean that Modi will continue to push for technology and its application in India along with infrastructure development.
However, a lot depends on Modi's ability to reduce the amount of bureaucracy for people who want to invest in India, Mobius added.
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