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As global investors assess their options in the changing backdrop of international investments, one country seems to be capturing the spotlight: India. Several India ETFs including Vaneck India Growth Leaders ETF (GLIN - Free Report) , Vaneck Digital India ETF (DGIN - Free Report) , Franklin India ETF (FLIN - Free Report) , iShares MSCI India Small-Cap ETF (SMIN - Free Report) and Wisdomtree India Earnings Fund (EPI - Free Report) have hit a 52-week high lately. We'll tell you why.
Untapped Potential of India
A recent assessment by Jitania Kandhari, Deputy Chief Investment Officer for Solutions & Multi-Asset at Morgan Stanley, highlights India's unique position as a hotspot for investment, contrasting it with the challenges faced by its neighbor, China, as quoted on CNBC.
Kandhari's insights shed light on India's underinvestment scenario, where the investment to GDP ratio has been on a decline. However, a significant shift is underway. There has been a push among companies to diversify supply chains.
This strategic shift has led to a resurgence in investment and manufacturing activities in India. With its vast pool of skilled labor and a consumer market poised for growth, India presents an enticing opportunity for investors looking to capitalize on its potential.
Real Estate Resurgence
One of the winning areas of potential growth lies in India's real estate sector. Kandhari notes that India's real estate market is at the beginning of a new cycle, thanks to initiatives such as "made in India" and the establishment of global centers.
Unlike China, which grapples with oversupply and debt-related challenges in its real estate sector, India is categorized by an undersupply of homes and property. This imbalance opens the door for investment in housing and property development.
China’s Geopolitical Tensions with the United States
China’s geopolitical tensions with the United States and its Western allies have also encouraged large multinationals to explore alternatives to China. India successfully hosted the G-20 summit in September, showcasing the Indian government's efforts to assume a leading role in global affairs as the West aims to counterbalance China's rising influence.
Global Companies Eyeing Manufacturing in India
The economy's narrative is bolstered by its positioning as an attractive hub for global investments, particularly in the wake of the pandemic-induced remote work trend. As global companies set up operations in India, the country's economic potential is further enhanced. Notably, Tesla (TSLA - Free Report) is mulling over to set up India factory for electric cars.
The world’s most valuable company, Apple (AAPL - Free Report) , is reportedly planning to increase its manufacturing presence in India to account for approximately 20% of its global iPhone production over the next two years. Nvidia (NVDA - Free Report) recently announced partnerships with Indian conglomerates Tata Group and Reliance Industries in the field of artificial intelligence.
Upbeat GDP Growth in Q2
India's economy grew 7.8% in the Q2, the maximum in a year and slightly surpassing market expectations of a 7.7% expansion. The robust performance of the service sector can be attributed for the GDP growth, coupled with strong consumer demand and increased government capital expenditure. According to the IMF's World Economic Outlook, India remains the world's fastest-growing major economy, with a projected growth rate of 6.1% for this year and 6.3% in 2024.
ETFs in Focus
Against this backdrop, India ETFs surged in the past three months and beat the S&P 500 (down 0.7%) (as of Sep 22, 2023).
iShares MSCI India Small-Cap ETF (SMIN - Free Report) – Up 8.4% in the Past Three Months
VanEck India Growth Leaders ETF (GLIN - Free Report) – Up 7.8%
Image: Shutterstock
India ETFs Surge in Q3: Here's Why
As global investors assess their options in the changing backdrop of international investments, one country seems to be capturing the spotlight: India. Several India ETFs including Vaneck India Growth Leaders ETF (GLIN - Free Report) , Vaneck Digital India ETF (DGIN - Free Report) , Franklin India ETF (FLIN - Free Report) , iShares MSCI India Small-Cap ETF (SMIN - Free Report) and Wisdomtree India Earnings Fund (EPI - Free Report) have hit a 52-week high lately. We'll tell you why.
Untapped Potential of India
A recent assessment by Jitania Kandhari, Deputy Chief Investment Officer for Solutions & Multi-Asset at Morgan Stanley, highlights India's unique position as a hotspot for investment, contrasting it with the challenges faced by its neighbor, China, as quoted on CNBC.
Kandhari's insights shed light on India's underinvestment scenario, where the investment to GDP ratio has been on a decline. However, a significant shift is underway. There has been a push among companies to diversify supply chains.
This strategic shift has led to a resurgence in investment and manufacturing activities in India. With its vast pool of skilled labor and a consumer market poised for growth, India presents an enticing opportunity for investors looking to capitalize on its potential.
Real Estate Resurgence
One of the winning areas of potential growth lies in India's real estate sector. Kandhari notes that India's real estate market is at the beginning of a new cycle, thanks to initiatives such as "made in India" and the establishment of global centers.
Unlike China, which grapples with oversupply and debt-related challenges in its real estate sector, India is categorized by an undersupply of homes and property. This imbalance opens the door for investment in housing and property development.
China’s Geopolitical Tensions with the United States
China’s geopolitical tensions with the United States and its Western allies have also encouraged large multinationals to explore alternatives to China. India successfully hosted the G-20 summit in September, showcasing the Indian government's efforts to assume a leading role in global affairs as the West aims to counterbalance China's rising influence.
Global Companies Eyeing Manufacturing in India
The economy's narrative is bolstered by its positioning as an attractive hub for global investments, particularly in the wake of the pandemic-induced remote work trend. As global companies set up operations in India, the country's economic potential is further enhanced. Notably, Tesla (TSLA - Free Report) is mulling over to set up India factory for electric cars.
The world’s most valuable company, Apple (AAPL - Free Report) , is reportedly planning to increase its manufacturing presence in India to account for approximately 20% of its global iPhone production over the next two years. Nvidia (NVDA - Free Report) recently announced partnerships with Indian conglomerates Tata Group and Reliance Industries in the field of artificial intelligence.
Upbeat GDP Growth in Q2
India's economy grew 7.8% in the Q2, the maximum in a year and slightly surpassing market expectations of a 7.7% expansion. The robust performance of the service sector can be attributed for the GDP growth, coupled with strong consumer demand and increased government capital expenditure. According to the IMF's World Economic Outlook, India remains the world's fastest-growing major economy, with a projected growth rate of 6.1% for this year and 6.3% in 2024.
ETFs in Focus
Against this backdrop, India ETFs surged in the past three months and beat the S&P 500 (down 0.7%) (as of Sep 22, 2023).
iShares MSCI India Small-Cap ETF (SMIN - Free Report) – Up 8.4% in the Past Three Months
VanEck India Growth Leaders ETF (GLIN - Free Report) – Up 7.8%
VanEck Digital India ETF (DGIN - Free Report) – Up 7.4%
WisdomTree India Earnings ETF (EPI - Free Report) – Up 6.4%
Invesco India ETF (PIN - Free Report) – Up 4.6%