Wood says India the most exciting stock market story

Last Updated: Sat, Jul 19, 2014 13:15 hrs

CLSA, the prominent foreign brokerage, has increased the weight allotted for India in its Asia-Pacific (ex-Japan) relative returns portfolio.

Christopher Wood, its chief equity strategist, has termed India the world's most exciting stock market story' in his widely read newsletter, Greed & Fear.

The weight allotted for India has been raised by one percentage point in the index, to 16 per cent. The Hong Kong-headquartered equity brokerage and investment group has termed some recent policy announcements as positive'. Among these are easing of bank lending rules for infrastructure projects and proposed changes in the land acquisition law.

"This (recent government action) is a reminder that the Modi government will be all about promoting investment...These are all positive moves in what remains the world's most exciting stock market story," Woods wrote.

The brokerage has advised its clients to ignore any disappointments they have from the Union Budget. "It is an unfortunate legacy of India's colonial heritage that exaggerated attention is paid to the government's annual budget. For such reasons, (we) would advise investors to ignore entirely the alleged disappointment over the Modi government's first budget, announced on July 10. The key point, as noted by CLSA's India office, is that the budget is not the only platform for government action," it said.

CLSA has been positive on India's prospects under Narendra Modi's leadership since last year. In a November 2013 report, the brokerage had predicted that the Indian stock market could stage a dramatic rally' if the Bharatiya Janata Party (BJP) won the general election.

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