Indian shares are too expensive: Citigroup
Citigroup considers Indian shares at current levels as “expensive” and expect the benchmark index, Sensex, to drop between 13,500 and 14,000 by the end of 2009. HT Correspondent reports.business Updated: Jun 24, 2009 22:51 IST
Citigroup considers Indian shares at current levels as “expensive” and expect the benchmark index, Sensex, to drop between 13,500 and 14,000 by the end of 2009.
“India is not a cheap market,” said Aditya Narain, Head-India Research at Citigroup. “Indian market’s valuation is 15-16 times the earnings. From market perspective, prices can be a little higher than these levels. They can’t go to peak levels.”
The Sensex closed at 14,422 points, up 0.69 per cent from previous close.
Narain said the Indian economy will revive but not to the rocking levels of 9 per cent growth seen in the previous few years. “In bull years, India grew faster because of high foreign capital flows. In 2007-08, foreign capital flows totaled $100 billion, which had raised the level of growth.”
India is now seen benefiting from the return of risk appetite among global investors. The global economy will rebound next year (2010) in a “U-shaped” recovery and not “V-shaped”, said Markus Rosgen, Chief Asia Strategist at Citigroup.
India currently does not have any brands in he top 200 global brands but in the next 5-10 years Asian brands would find a place among global brands. “In Asia, its banking system is fully functional and the corporate sector is under-leveraged. Asian companies will now leverage overseas,” said Rosgen.
First Published: Jun 24, 2009 22:36 IST