Foreign investors may have turned cautious of the rally in Indian stock markets, however, Cartica Management LLC, which manages more than $3.2 billion of assets globally is convinced that India is going through a quality stock market rally.
Foreign investors may have turned cautious of the rally in Indian stock markets, however, Cartica Management LLC, which manages more than $3.2 billion of assets globally is convinced that India is going through a quality stock market rally. In an interview to CNBC TV18, Teresa Barger, the co-founder and CEO of Cartica Management said, “ You had EPS growth, at least in the companies we like. This is a quality kind of rally. So, as longer-term investors we are not concerned about the hiccups.” In September this year, Teresa Barger had revealed that the company is betting big on Cholamandalam Finance. “We only go into high quality companies with high integrity sponsors. So we are in admiration of the Murugappa group, ” she told ET Now adding, “It’s (Cholamandalam) niche in the market. Its ability to use data on where it’s going in terms of new products. They are growing with smaller footprint, we like the access to the SMEs, along with their superior credit processes.”
Many fund managers are pointing out that the earnings season so far has been better than anticipated, and hence, the market valuations may not be too stretched. In an interview to ET Now, Taher Badshah CIO (Equities), Invesco Mutual Fund said this week,“ One should dissect the earnings to see how many companies are actually over-delivering, or beating street estimates versus earlier. An analysis of the 35 companies of Nifty which have delivered results so far, 75% of them have actually beaten street estimates, or at least met them. This number was closer to 55% in the last four or five quarters. This is a better way to track earnings delivery versus expectation, and I believe on that front, things seem to be getting better.”
Krishna Kumar Karwa of Emkay Global said that the quarter has also seen greater target stock price upgrades. In an interview to CNBC TV18, Krishna Kumar Karwa, Managing Director at Emkay Global Securities said, “ Out of the companies under coverage at our end, almost hundred companies have announced their results. There have been target price upgrades on at least 50 companies, which is much more than what was happening on quarter or few ago. Even on the EPS upgrades, in 40-45 companies have seen them in FY-18 and FY-19. My sense is that the numbers have been better than expected.”