Modi’s reforms set Indian stocks on fire

Indian stocks pass a new milestone, but global fund managers are holding back. Are there signs of overheating?

Indian currency on virtual interface of stock market data
(Image credit: triloks)

Indian stocks “are on fire”, says Jacky Wong in The Wall Street Journal. The BSE Sensex stock index has rocketed 28% higher over the past 12 months and has more than tripled since an April 2020 pandemic low. The boom rests on strong fundamentals. 

GDP expanded 6.7% year-on-year in the second quarter, with net company earnings up 9% or so over the same period. Billions of dollars of inward investment are pouring into local manufacturing as multinationals look to diversify supply chains beyond China. Still, with the local market trading on a forward price/earnings ratio of more than 24 – pricier even than US stocks – investors are being asked to pay dearly for a piece of the action. 

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Markets editor

Alex is an investment writer who has been contributing to MoneyWeek since 2015. He has been the magazine’s markets editor since 2019. 

Alex has a passion for demystifying the often arcane world of finance for a general readership. While financial media tends to focus compulsively on the latest trend, the best opportunities can lie forgotten elsewhere. 

He is especially interested in European equities – where his fluent French helps him to cover the continent’s largest bourse – and emerging markets, where his experience living in Beijing, and conversational Chinese, prove useful. 

Hailing from Leeds, he studied Philosophy, Politics and Economics at the University of Oxford. He also holds a Master of Public Health from the University of Manchester.