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Investors more willing to invest in India than China: Bloomberg report


NEW DELHI: Indian stocks attracted a net inflow of $25 billion in the period from the start of this year to March, according to data compiled by Bloomberg. Meanwhile, equity investment in China stood at $5.3 billion.

Investors’ attention is said to have turned to Indian stock markets due to the belief that population growth and rising middle class incomes will lead to higher corporate profits.

India and Japan’s stock market indices have risen to record highs due to faster economic growth and lower inflation. Also, corporate reforms have also been very favorable for the growth of the Japanese market.

China’s market slumped on the back of ratings issued by international rating agencies. As a result, investors have chosen India-Japan markets as the best investment platforms.

According to Kieran Calder, Chief Analyst, Equity Market Division, Bancare Private Limited, Singapore, “Investors are more interested in buying expensive Indian stocks than buying cheap Chinese stocks because companies are converting GDP growth into better earnings growth.”

Indian stocks trade at around 23 times next year’s expected earnings. Meanwhile, Chinese stocks have fallen 40 percent from their peak three years ago. Market experts predict that the Chinese market will underperform compared to the Indian and Japanese stock markets over the next 12 months.

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