There is something about investing in India that most investors are not aware of. INTO INDIA is pleased to bring this important statistic to you.
India is a rare market that has delivered double digit annualised returns in USD terms consistently over a 5, 10, 15 and 20 year time frame. Even the US has not done that, falling just short over the 20 year time horizon.
Why is this happening?
This startling fact was drawn to the attention of INTO INDIA by Anish Mathew, Chief Executive Officer & Chief Investment Officer, Sundaram Asset Management Singapore Pte Ltd.
Anish explains – “There are a couple of key reasons for this in my view. India is a capital scarce country and hence cost of capital has always been high in India.
“This has resulted in corporates being generally disciplined about their capital allocation decisions which in turn has benefited their shareholders over the longer term.
“Secondly, the correlation between economic growth and corporate profits is the highest amongst its EM peers. Studies have shown that over a 20 year period, it is around 0.62.
“As the Indian economy has grown at an average of 6% since 1980, corporate profits have benefited, thereby underpinning the performance of the Indian market over the long term,” he said.
For those who love the stats:
The MSCI INDIA Net Total Return USD Index:
5 years – 11.92%
10 years – 10.06%
15 years – 10.42%
20 years – 11.04%
Makes INTO INDIA wonder – are we missing the India investment opportunity?
Into India 
India stands out for its macroeconomic stability. Its long-term growth potential is underpinned by cross-sector reforms, efforts to attract foreign capital, maturing capital markets, demographics, supply chain realignment, and digitalization. One example, in 2014 the foreign exchange reserves of the country was US$ 320 billion and now exactly 10 years later it has touched US$ 650 billion. That is a big growth.
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