India - Record Asia Ex-Japan Fund Exposure After Modi Re-Election

Deputy Chief Economist

Sharmila Whelan

Independent and original Asian investment research

Aletheia Capital

Aletheia Capital (HK) Ltd. (previously known as Asianomics) combines the extensive knowledge of its experienced team with technology and regulatory changes to disrupt Global Markets business in Asia. The firm is completely independent with no conflicts of interest either on Investment Banking advisory or Capital Markets execution.

Macroeconomics

<p>Mr Modi may have swept back to power but he cannot rest of laurels. Growth is slowing. The corporate profit cycle is fragile at best and suggest that large companies in the capital goods space are yet to repair their balance sheets. Unsurprisingly the private investment cycle remains weak and the credit cycle in downturn. Until it becomes clearer how Mr Modi plans to address the current economic malaise we would stay underweight Indian equities.</p>

Mr Modi may have swept back to power but he cannot rest of laurels. Growth is slowing. The corporate profit cycle is fragile at best and suggest that large companies in the capital goods space are yet to repair their balance sheets. Unsurprisingly the private investment cycle remains weak and the credit cycle in downturn. Until it becomes clearer how Mr Modi plans to address the current economic malaise we would stay underweight Indian equities.

DSP BlackRock Liquidity Fund (DSLQYDG IN)

India - Challenges Ahead For Mr Modi