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India Investing - ideas


shalab
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Very interesting thread, shalab. I think there is a huge potential in Indian market.

 

Seems like the best way to invest currently is through multi-national companies. You can learn and follow them easily through their financial statements, they may have a good business on it's own, plus you get the exposure to the Indian market.

 

The large tech companies as mentioned before, and I will add FMCGs: Unilever, Nestle, Procter & Gamble, Mondelez, PepsiCo. Also beer companies have significant operations there: BUD, Heineken etc..

 

https://economictimes.indiatimes.com/industry/cons-products/fmcg/indian-consumer-products-market-sees-13-5-growth-in-fy18/articleshow/63980595.cms

 

I've searched for several sources, to get more info about exposure to Indian market, but it's hard to find any kind of summary. Should dig deeper.

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Very interesting thread, shalab. I think there is a huge potential in Indian market.

 

Seems like the best way to invest currently is through multi-national companies. You can learn and follow them easily through their financial statements, they may have a good business on it's own, plus you get the exposure to the Indian market.

 

The large tech companies as mentioned before, and I will add FMCGs: Unilever, Nestle, Procter & Gamble, Mondelez, PepsiCo. Also beer companies have significant operations there: BUD, Heineken etc..

 

https://economictimes.indiatimes.com/industry/cons-products/fmcg/indian-consumer-products-market-sees-13-5-growth-in-fy18/articleshow/63980595.cms

 

I've searched for several sources, to get more info about exposure to Indian market, but it's hard to find any kind of summary. Should dig deeper.

 

Exposure to above multinational doesn’t give you much leverage to growth in Indian, as it is only a small part of the operations. Many of the above actually have their subs trading in China (Unilever) albeit at nose bleeding valuation and for us retail investors, there isn’t a good way to buy Indian stocks on their native exchange directly.

 

It’s an interesting market, just like Korea, but unfortunately not accessible to retail investors.

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About half of our fund's money invested in India in 3 stocks; two previously discussed here,

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/india-piramal-enterprisespel-in-ajay-piramal-outstanding-capital-allocator/msg312235/#msg312235

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/idfc-ltdidfc-bank-(special-sitspin-off-india)/msg303988/#msg303988

 

Other company is Shriram Transport Finance in which Piramal also has a stake.

 

Unfortunately Spekulatius is correct though; nosebleed admin. We just opened an account with Interactive Brokers, which does allow us to trade in India, but it's because we already have a PAN card (tax registered) and you need a local custodian.

 

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One can open a trading account - as Guy Spier mentioned, it can take a while to open one. It took two years for him and it took a while for me. I went through tradeplusonline.com. They offer excellent customer service and the process went quickly once I went with them.

 

http://www.nriinvestindia.com/qfi.html

http://investindia.kotak.com/qualified-foreign-investor

 

https://www.tradeplusonline.com/

 

Also - when investing in India, be careful. Here is the story of one super investor who lost money and is complaining to SEBI (SEC of India).

 

https://economictimes.indiatimes.com/markets/stocks/news/made-a-mistake-says-porinju-veliyath-after-investor-wealth-eroded-by-44/articleshow/67511297.cms

 

Another thing to be aware of is that India's inflation rate is around 7-8% - whereas USA inflation rate is around 2% or lower. So one should expect currency depreciation over time in India.

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Dont think it works for USA based investors.

 

Here is one idea if you are ok with cigarette companies. BTI (British American Tobacco) which owns close to 30% of ITC (India) looks cheap and sports 8%+ dividend yield. ITC has branched off from tobacco and is in the hospitality business. 1/5 of BTI valuation is covered by its ITC stake.

 

In what about investing in Indian mutual funds?

 

Franklin India Prima had 19.75% CAGR over 22 years:

 

https://www.franklintempletonindia.com/investor/fund-details/fund-performance/franklin-india-prima-fund-4615

 

Even after adjusting for Indian Rupees weakening agains USD it's not too bad:

 

https://im.rediff.com/money/2016/sep/19graph-rs.jpg

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One can open a trading account - as Guy Spier mentioned, it can take a while to open one. It took two years for him and it took a while for me. I went through tradeplusonline.com. They offer excellent customer service and the process went quickly once I went with them.

It  works even without a PAN card?

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