 "India needs more large-cap firms to correct valuations:Mobius")
Giving his views on the lukewarm Indian markets, Mark Mobius, executive chairman of Templeton Emerging Markets said in an interview with CNBC-TV18 , that valuations need to correct further in India.
Upbeat economic news from the US and a stronger eurozone bailout fund lifted investor sentiment on Thursday, supporting most stock indexes and the euro.
Mobius feels global markets are not necessarily moving rationally and that volatility is here to stay at the moment. “The fundamentals are still excellent for emerging markets. The growth is good and I think we will pull through this very nicely,” a confident Mobius asserted.
He also said that decisions are sometimes irrational because with the high speed trading, it’s the computers that are trading and not the people.
Mobius argued that the problem in India is that the valuations are rather higher compared to the rest of the world. “But with the corrections that are happening we will see more money coming into India gradually. We need more choices in India, we need more privatisation, and large-cap companies coming in the market. So, the valuations will be pushed down to more reasonable levels.”
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