"The Indian story would, in GREED & fear’s view, be badly damaged if the formidable Narendra Modi was not re-elected," Chris Wood writes.
Even as top market voices try to gauge the impact of upcoming elections on the stock market, CLSA’s Chris Wood warns that if the current Prime Minister Narendra Modi is not re-elected in 2019, India’s growth would take a beating. In his Greed and Fear report, Chris Wood, equity strategist at CLSA said, “The Indian story would, in GREED & fear’s view, be badly damaged if the formidable Narendra Modi was not re-elected. India remains the best long-term story in Asian equities out of all the Asian markets covered by CLSA.”
Wood points out that India has not been the flavour of the month in so far in 2018, especially with a bond market sell-off and continued rupee weakness, on rising oil prices and rising current account deficit. “There is also talk of fiscal slippage amid fears of resurgence of populism ahead of general election,” he said.
Following the Rs 11,400 crore PNB scam, even as we continue to see major developments in the Indian banking space, Wood says that there has been a banking issue in India for several years and he is hopeful that all this news flow creates more determination for the government to let the whole bankruptcy resolution process work as outlined in the new legislation.
With ICICI Bank CEO in focus due to recent reports of alleged impropriety in Videocon loan case, and Axis Bank CEO Shikha Sharma’s curtailed term, Wood says that he is buying only ‘real private sector banks’. “They are called private banks but actually they are not private banks because they are historically public sector banks. I would call those two entities pseudo private sector banks. My equity allocations are in real private sector banks,” Chris Wood told ET Now in a recent interview.
In his interview with ET Now earlier this week, Chris Wood expressed his bullishness on the affordable housing theme and residential real-estate stocks. “The areas I want to play most are affordable housing in India which is a five-year story and I want to play the real estate sector based on the consequences of this RERA legislation which I believe will lead to a healthy consolidation,” he said.