Mark Mobius, Partner, Mobius Capital Partner and an eminent investor, remains positive about the Indian market for the long term as the country is expected to become a hub for the semiconductor business.
Mobius said he is looking to increase allocation to India going forward as he still has a very positive outlook for the country.
In an interview with ET Now, Mobius said his biggest allocation is Taiwan and then India.
"India has come down a little bit, but the good news for India is that exports from Taiwan to India are going up, which is a very significant change because that means that more and more semiconductor business is going to be flowing into India and this is going to be very positive for India," Mobius pointed out.
He said he was not too concerned about the short-term moves as India's long-term potential is immense.
"The market could go down 10 percent, 15 percent, or even 20 percent, that really does not concern me, in fact, it could be an opportunity to buy more," he told ET Now.
Mobius said it all depends on the kind of stocks one holds.
"If you are holding stocks with very little debt, with a good return on capital, then you should do fine regardless of what happens to the market," he said.
He underscored that a big correction or a bear market is usually short-lived after which it provides an incredible buying opportunity. So, it does not make sense to try to predict the course of the market for the year, next year, three years, or five years from now.
"The best thing to do is to find great stocks, stick to those regardless of what happens, buy more when the price goes down and you will do very very well. There will be corrections along the way, of course, but at the end of the day those who are in the Indian market, in good stocks, in stocks with low debt, should do fine," said Mobius.
Talking about the emerging markets, Mobius said the emerging markets have underperformed the US market because people are looking at China. However, he does not believe the narrative of booking profits out of India and moving to China is real.
He said there has been some recovery in the Chinese market because the Covid situation has been suppressed and the Chinese economy has opened up.
However, it has not worked well because of subdued participation by local people.
"...Chinese government is welcoming foreign investment and is trying to encourage more investment in China. But it really has not worked very well because the Chinese market has come down. And the reason for that is that the biggest market makers in China are the local people who invest in the stock market. If they are not confident or if they do not have the money to put into the market, then the market will not do very well and, that affects the emerging markets index because China is about 30 percent of the index," said Mobius.
Talking about the recent banking crisis, Mobius told ET Now that people are beginning to question the safety of banks which is why gold prices are rising and Bitcoin is going up.
"If investors are worried about their bank deposits, they do not go into stocks because they feel that the stock market may not do well if the inflation numbers go up and the Fed becomes more aggressive on interest rate increases. So, they turn to assets like gold. It is gold and maybe Bitcoin because they feel Bitcoin may not be affected by these other factors," he said.
Disclaimer: This article is based on an ET Now interview. The views and recommendations given in this article are those of the expert. These do not represent the views of MintGenie.
