Credit Suisse said Indian stocks join Asia’s ‘cheapest 4′ club
Credit Suisse mentions that India has joined “the Cheapest-4 club” as of Tuesday, implying that, it is amongst the four most inexpensive markets in the entire Asia ex-Japan region. The investment bank notifies that in the 14 previous episodes in which India did joined the club, domestic shares have went on to surpass 13 of them, the only exception being made in the year 2003.
Credit Suisse throws light on various contributors like Reliance Industries [BSE 1.69%],Tata Motors [BSE 3.73%], Sterlite Industries (India) Ltd. [BSE 4.47%], Bank of Baroda[BSE 0.65%], HCL Technologies [BSE 4.36%] citing valuations. Credit Suisse refers to Wipro and HCL Technologies amongst its top selections in India, citing expectations for a corporate level Capital Expenditure recovery.
Credit Suisse says that the main risk to involved is that India is flooded by foreign investors. Tuesday embarked upon India the regain of its physiological level of 19000 in the afternoon trade due to heavy buying in ICICI Bank, Reliance Industries and Tata Motors. According to the people ‘into the business’ mostly the dealers and trade gurus, maximum stock was in the over-sold which lead to the development of a possibility of a pull-back.
The BSE IT Index also soared over the regular 1% on Tuesday and hence proved to be one of the top most gainers amongst the other sector indices on the scale of Bombay Stock Exchange. The BSE IT Index went up by 1.2 per cent, as a consequence of the gains in the IT Sector companies like HCL Technologies, Wipro, Financial Technologies, TCSBSE 1.99 % and MphasiS. The CNX IT Index was trading at 82 points higher at 7184.50 or at 1.17 per cent. The index backed by strong buying in large cap IT companies, went up to its highest level since Apr 14, 2011.
The ever increasing overseas investors have taken it to be a fruit reaping venture and gregariously pumped in Rs. 24000 crore (USD 4.6 Billion) itself in the Indian stock market during the month of February itself. This makes Feb, to be the 8th consecutive month of inflows, making total investment to USD 8.4 billion so far.
Various Foreign institutional investors (FIIs) proved to be the gross buyers of the shares worth Rs 78,888 crore, while the gross equities being sold amounted to Rs 54,449 crore. This gives us a net inflow of Rs. 24,439 crore (USD 4.57 billion), as per the Sebi data. Illuminating the investment rationale, the bank notifies that they incorporated Tata Motors into their regional portfolio on 3 Jan 2012 at 197 percent discount to the region and referred that they have trimmed their weighting from 5-3% as the discount shrunk to 70%.