FIIs bearish on India: JP Morgan

Foreign Institutional investors (FIIs) continue to be bearish on India and expectations are that India would get less of net inflows into emerging markets, according to Adrian Mowat, chief Asia equity strategist, J P Morgan.

"All emerging markets, other than Chile, are cheaper than India even after the recent downward movement of the Indian markets," he said.

Indian equity markets are ahead of the India growth story and the recent pullback by foreign institutional investors is indicative of the portfolio changes being made by global investors.

Mowat pegged that additional inflows into India till the end of the calendar year could be higher than $5 billion but less than $10 billion.

JP Morgan's target for the Indian market is at 11,000 for the Sensex by the end of the calendar year and predicts earnings growth for corporates to be between 15 per cent and 20 per cent.

The growth figures for Indian corporates are stronger than other Asian emerging markets, other than Taiwan. Technology companies in Taiwan are turning around and posting better results, Mowat said.

About the recent downturn on the bourses, he said, "There has been a general outflow of money from emerging markets in the last week or so. I think that is a purely tactical portfolio trend and we will begin to see the continuation of existing trend that has been in place for a while, which is the net inflow into emerging markets."