Equity and debt: Neither is a magnet today
Capital allocation into Indian equities is a function of three variables: earnings growth visibility, starting valuations, and the taxation framework. On all three counts, India currently faces headwinds. Earnings momentum, while improving at a broader level, 456 companies in our tracking universe showed revenue growth of 11.6% YoY and PAT growth of 15% YoY, has not yet translated into the kind of earnings surprise cycle that compels foreign re-rating.
