Last Updated : Jan 28 2013 | 5:12 PM IST
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MTD return (%) -
In US dollars |
Country |
MSCI Index |
Trailing P/E |
12 Month
forward P/E |
| -10.31 | -12.50 | India | 310.70 | 15.89 | 13.86 |
| -11.37 | -11.33 | China | 26.03 | 11.66 | 11.48 |
| -5.60 | -10.73 | South Africa | 429.23 | 12.57 | 10.85 |
| -10.49 | -10.49 | Russia | 697.78 | 9.75 | 8.66 |
| -7.92 | -10.03 | Brazil | 122419.58 | 9.49 | 8.14 |
| -8.26 | -9.41 | Taiwan | 235.23 | 11.41 | 10.32 |
| -7.21 | -8.41 | EM | 27387.71 | 11.69 | 10.66 |
| -7.45 | -7.54 | Korea | 319.49 | 9.31 | 8.39 |
| -7.74 | -7.03 | Thailand | 267.85 | 10.42 | 10.05 |
| -3.42 | -3.97 | Mexico | 16649.16 | 13.58 | 12.79 |
| -5.09 | -2.58 | Indonesia | 1398.16 | 10.40 | 9.10 |
| 1.40 | 3.47 | Phillippines | 399.62 | 12.86 | 11.54 |
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| But despite the sharp loss in October, the odds are stacked against India. Valuations in India were higher than most other emerging economies making it relatively unattractive even before the crash. Now, after the sharp fall in regional markets, India continues to be the most expensive.
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| Based on a trailing price-earnings ratio, India commands an earnings multiple of 15.89 times way ahead of other potent markets like Brazil (9.49), Russia (9.75), Korea (9.31) and the emerging markets average multiple of 11.69.
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| Not that growth will justify these valuations. Even based on consensus 12-month forward estimates, India tops the pack on valuations. The uncertainty on the currency front is also making foreign investors anxious. Given this scenario, it is difficult to imagine that India would escape the flight of capital this time around.
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| What does this mean for the Indian market? In April and May 2005 when FIIs were net sellers the market did not tank as much, as mutual funds provided support with net purchases worth nearly Rs 4800 crore. But this time despite the huge purchases by mutual funds this month, the expensive valuations have dragged the index down.
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| Market experts say that it may not be time to bottom fish yet since the market are still at fair valuation plus something. Slower flows and less margin of safety may mean that investors will have to wait and watch and not jump in yet.
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With the markets changing track, The Smart Investor spoke to some leading technical analysts for their take on future market direction, Here
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First Published: Oct 31 2005 | 12:00 AM IST
