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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (4332)	5/24/1999 8:38:00 AM
From: Mohan Marette	Read Replies (1) \| Respond to of 12475

Indian stocks cheapest in S-E Asia: FICCI Source : _UsrStory May 24, 1999, 12:00:00 AM Indian stocks markets, even after the recent boom, are the cheapest among the emerging markets of South-East Asia based on price earning (P/E) ratio, a study by the Federation of Indian Chamber of Commerce and Industry (FICCI) has said. The study titled "An analysis into the capital market boom" says as against the average P/E ratio of Indian stocks at 16.6, the competing ratio in countries like China is 25.8, South Korea 25.3, Indonesia 23.1 and Malaysia 19.8. FICCI analysis reveals that the P/E ratio in India has potential for reaching around 25, a gain of about 50 per cent from the current levels. The reason for higher P/E ratio for Indian stocks is the focus of FIIs due to low inflation rate which is unlikely to depreciate the rupee along with higher earning expectations, an increased export growth and better indirect tax realisation, the study said. The analysis by FICCI was worked out after close scrutiny of 42 stocks which witnessed the most intensive buying in the current rally leading the BSE Sensex to cross the 4,000 mark. The current boom in the capital markets seems to be a sustained one and the Sensex will rule at over 4,000 mark in the coming months, a chamber statement said on Sunday. The FICCI study said, India's economic recovery has coincided with a period when investment opportunities in other emerging markets are limited. "Indian companies with low P/E ratio and strong fundamentals are expected to gain from FII investment," it said. The chamber said, despite political uncertainty Indian economy is expected to achieve a growth rate of around six per cent and fall of BJP government made opportune time for FIIs to buy Indian stocks. The study further said the current boom in the capital market is here to stay at least in the medium term (till the next mid-term election) as UTI had been looking for booking profits for their annual closing and is expected to be back from July onwards. (FE)