Christopher Wood, global head of equity strategy at Jefferies, continues to bet big on India’s hot property market. The Greed & Fear team has observed that rising interest rates is not stalling recovery in the real estate space.
On that basis, he has decided to make changes to the India exposure in Asia ex-Japan and India long-only portfolios.
Godrej Properties has been replaced in his Asia ex-Japan long-only portfolio by Macrotech Developers, which has a 6 percent weighting, while the investment in Bajaj Finance has been decreased by one percentage point.
In Mumbai, Palghar, Noida, and Bengaluru, land lots have been purchased by Godrej Properties on a buying binge. Macrotech Developers, meanwhile, plans to introduce 16 new projects in the second half of this fiscal year, with a potential sales volume of Rs. 10,300 crore.
The exposure to Bajaj Finance has decreased by two percentage points and climbed by two percentage points in Greed & Fear’s India long-only portfolio.
The weighting of Macrotech Developers and DLF Limited has increased in the same portfolio, whilst investments in Godrej Properties and Century Textiles have decreased. Adani Ports has been added to the portfolio in place of Jubilant Foodworks, with a weighted of 4%.
Jubilant Foodworks, the master franchise for Domino’s Pizza operations in India, reported strong second quarter results with net profit up 9.8% YoY but analysts are still concerned about margins. Adani Ports, meanwhile, experienced record revenue and EBITDA in Q2FY23.
According to Wood’s assessment for the entire Asian market, MSCI China is currently trading at its lowest level since October 2011, indicating that “the worst has probably already been priced in.” He emphasised in his assessment that this warrants a tactical overweight on China, but not a significant overweight.
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