Christopher Wood hiked allocation to Indian equities in his Asia Pacific relative-return portfolio
Published On: Friday, October 16, 2020 | By: Team KnowMyStock
Christopher Wood, global head (equity strategy) at Jefferies in his latest note to investors, said that he has hiked allocation to Indian equities in his Asia Pacific ex-Japan relative-return portfolio by one percentage point and added two percentage points to the existing investment in HDFC in the Asia ex-Japan long-only portfolio. At 2x 12-month forward adjusted book, compared with a five-year average forward price-to-book ratio (P/BV) of 2.6x, Wood feels HDFC’s valuation remains attractive. Among Indian stocks, besides HDFC, Wood also holds Reliance Industries (RIL), Maruti Suzuki, SBI Life Insurance, ICICI Lombard General Insurance, DLF, and Cipla in his Asia ex-Japan thematic equity portfolio for long-only absolute-return investors.
Analysts at Morgan Stanley, on the other hand, are trading with caution on the financial sector and suggest the sector could lose its leadership status in any new bull-market given an over-owned position. In addition, Morgan Stanley believes, policy measures adopted by the government will go a long way in attracting foreign flows into equities. However, the market’s performance in the near-term remain hinged on global factors, which they feel, will keep them choppy. India, Morgan Stanley said, needs to continue to deliver policy that lifts its potential growth in the eyes of market participants.
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