India most exciting structural story in emerging markets: Gustavo Medeiros

Gustavo Medeiros, Global Head of Research, Ashmore Investment Management, says India still trades at a premium to emerging markets but is a much smaller premium than it was before the correction, about three-four months ago. Therefore, Ashmore has started to look into some of the companies that they like to find opportunities. In terms of structural stories, Medeiros says one should look into are overarching trends that have many years to play out. One of the top trends in India is inclusion of women in the labour market and the ability of India to absorb more manufacturing. These are two interesting structural trends and one should look into companies that will benefit from that from that perspective. Ashmore has always loved India, hasn’t it?
Gustavo Medeiros: Absolutely, yes, the world loves India. It is the most exciting structural story in emerging markets. It has been for many years, but particularly over the last 10 years, since economic policies have been much more pro-market.

In your strategy in India in the last six months, net-net have you bought more or have you sold more?
Gustavo Medeiros: Even though we like India structurally, over the last 12 months or so, we kept a tactical lighter exposure. In many equity portfolios, we are underweight India for the first time in a few years over the last 12 months. We have used this correction that we have seen to start adding exposure again to India. There was a significant correction on the Indian stock market as a result of the flows that you already