While Indian markets have been acting jittery due to fears related to earnings downgrade and a slowing economy, financial major Credit Suisse feels that a crisis is unlikely and there are enough opportunities for bargain hunting.
The foreign brokerage highlights the fact that while the Indian market does not look cheap on an absolute basis on account of a 10% correction from the recent peak, the price-to-earnings (PE) ratio of MSCI India index is at the lowest level in eight years compared to that of MSCI World.
?On a relative basis, MSCI India?s P/E against MSCI World is the lowest in eight years, excluding the financial crisis period,? states the report by Credit Suisse analysts Neelkanth Mishra and Ravi Shankar, adding that ?against markets such as Brazil and Indonesia, the relative P/E is at decadal lows?. Only against China is the market more bullish on India on P/E, it adds.While in absolute terms the market is not in capitulation territory, it does show up in relative performance, says Credit Suisse.