JPMorgan sees foreign investors flocking to Indian stocks after elections

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Indian equities are poised to lure more foreign inflows after the general elections, with the economys promising growth prospects and the Federal Reserves rate cuts acting as catalysts...

Thats the view from Rajiv Batra of JPMorgan Chase & Co., who says global funds positioning in Indias $4.3 trillion stock market remains light and investors will use any correction as an opportunity to increase holdings..

Foreign investors who didnt increase relative positioning in India over last 2-2.5 years waiting for this clearing event, will start focusing back on growth-driven policies or reforms, Batra, an Asia strategist at JPMorgan, wrote in an email interview...

Investors will keenly be watching the seat-sharing arrangements if Modis ruling party retains power, said Singapore-based Batra, adding that policy continuity is essential for Indias market to sustain its higher valuation or even witness further multiple re-rating...

We estimate that if all benchmarked investors (EM, Asia ex-Japan, global ex-US and global) simply close their underweight positions on India, this would lead to $100 billion in inflows over the next few years, he wrote...

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