Chris Wood of Jefferies
Chris Wood of global brokerage firm Jefferies said that it will only be a matter of time before Sensex reaches the 100,000 level. “This target, on a five-year view, now assumes trend 15 percent EPS growth and that a five-year average one-year forward PE multiple of 19.8x is maintained,” he stated.
Wood sees no ‘obvious near-term trigger’ for a further valuation de-rating of stocks of Indian companies if the Reserve Bank of India pauses tightening of its monetary policy. “If the monetary tightening cycle is over, with rate cuts coming either later this year or next year, there is no obvious near-term trigger for a further valuation de-rating,” he said in his GREED & fear weekly newsletter.
Wood is of the view that Indian stocks are not as ‘expensive’ either absolutely or relatively to the region as last year and has increased his overweight position in Indian, Korean and Taiwanese stocks by 100 bps in his Asia-Pacific ex-Japan portfolio.
The strategist has removed HDFC Life Insurance and Standard Chartered Bank from Asia ex-Japan long-only portfolio and added Zomato and SBI Life Insurance, while raising weights for AIA Group, Bank Central Asia, Bajaj Finance, Godrej Properties and Macrotech Developers.
“Like all long-term bull markets, the Indian stock market will continue to climb the proverbial wall of worry,” Wood said, adding he sees a defeat of Modi in general elections as the biggest risk to the India story.
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- Source: https://www.moneycontrol.com/news/market-outlook/indian-stocks-not-39expensive39-sensex-will-hit-1-lakh-mark5-years-chris-woodjefferies_17035901.html
