Jefferies cautious on Indian markets due to 'unsustainably high' domestic inflows

Emcure Pharmaceuticals

16/09/2024 09:59

** Jefferies reduces weight on Reliance Industries
 RELI.NS , Amber Enterprises  AMBE.NS  and replaces Larsen &
Toubro  LART.NS  with Siemens  SIEM.NS  in its India model
portfolio
    ** Adds Emcure Pharma  EMCU.NS  and Interglobe Aviation
 INGL.NS  in India portfolio, increases weight on HDFC Bank 
    ** Jefferies says it has a near-term cautious view on
markets, small- and mid-caps, industrials and global cyclicals
    ** Brokerage is "overweight" on telecom, autos, consumer
staples and utilities, while remaining "neutral" on industrial
and "underweight" on energy
    ** Says changes done to reflect green shoots on consumption
    ** Jefferies says combined domestic inflows, through mutual
funds, direct participation, insurance and pension funds are at
"unsustainably high" $7.5 billion per month between January and
August
    ** "An estimated quarter of financial savings going to stock
market, which makes us uncomfortable on near-term equity outlook
and specifically small and mid-caps and industrials"
    ** India's Nifty  .NSEI  and Sensex  .BSESN , among the best
performing global markets in 2024, hit a record high on the day,
up 17% and 15%, respectively, this year
    ** Small-  .NIFSMCP100  and mid-caps  .NIFMDCP100   have
outperformed the benchmarks, rising 29% and 30.5% over the same
period

 (Reporting by Bharath Rajeswaran in Bengaluru)
 ((bharath.rajeswaran@thomsonreuters.com; +91 9769003463;))