The Indian stock market is sold on foreign investment. Can I carry the test test？

After the Indian stock market's "carnival" in early October, it recently encountered a significant callback.The sharp decline in the benchmark index has re -triggered the market's concerns about whether it has "topped".Behind this trend is the slowdown of corporate profit growth.

Data as of the 14th show that overseas investors have reduced their holdings of more than $ 7 billion in Indian stocks this month, the largest monthly outflow of monthly funds since March 2020.It is worth noting that a considerable part of this part of funds seems to have flowed to the Indian market.

"The attractiveness of the Indian market is obviously at the cost of sacrificing the Indian market." Ritesh Samadhiya, a strategist at Bank of America, pointed out in a report.Bangalore Wealth Management

Signs of the slowdown in the slow economic growth of India have become increasingly obvious.Analysts of Jefferies Financial Group Inc. predict that the profit growth of Indian companies may slow down to the lowest level of more than four years.Simla Wealth Management

Although the MSCI India index fell 2.6%in October, ending the upsurge of 11 consecutive months, its valuation is still high, which is almost 24 times that of almost 12 months of long -term revenue, which is much higher than the average estimate of five years.The value is about 21 times.This valuation is also more than twice that of the MSCI Index Index P / E ratio.

Signs of the slowdown of the Indian economy are reflected in many fields.In September, the growth rate of Indian goods and service tax fell to the minimum level of more than three years, and the sales volume of passenger car decreased by nearly 19%year -on -year.At the same time, the demand for power in August decreased year -on -year, and the purchasing manager index of the manufacturing and service industry also declined.

The latest financial report also brings disappointing news.The two companies that led India's US $ 250 billion industry in the two companies that lead the two industries of India have not reached expectations.

Some analysts believe that the slowdown in profitability is jointly promoted by the weakened consumption expenditure and the rise in commodity prices.Rajat Agarwal, the Asian stock strategist of the French Industrial Bank, said: "The macro momentum is significantly weakened, and the market generally expects downward risk, which may put pressure on the market."

The large -scale evacuation of overseas investors has also further exacerbated the pressure of the Indian stock market.Bernstein's quantitative strategist recently lowered the rating of Indian stocks from neutral to reduction, because the valuation of Indian stocks was too high. Compared with India and other emerging markets, its fragility has increased.

"We ended long -term momentum transactions to India because its valuation is currently at or close to historical highs, and the profit cycle is down downward." Analysts wrote in their research reports in their research reports.

Bangalore Investment