In his latest Greed & Fear Note to clients, Chris Wood of Jefferies says that the structural bull story remains in place with growing evidence that a new residential property cycle has commenced after a seven-year downturn despite the setback triggered by the Delta wave. Here are the key highlights from his latest note.
- Indian stock market has remained extraordinarily resilient
- India recovery tracker has risen from a low of 78% of the pre-Covid level in May
- Covid cases remain way off their high while the vaccination rate
- India also seems to be at a major inflection point in earnings with Corporate profits to GDP ratio
Chris Wood, Greed & Fear Jefferies on Real Estate
- Structural bull story remains in place with growing evidence
- New residential property cycle has commenced after a 7-year downturn
- Case that affordability remains at historically attractive levels
- Indian property is on move, Indian property stocks hitting their highest level
- Greed & Fear has a 17% allocation to sector in Indian long-only portfolio
- A broader-based private sector-driven capital spending cycle
- A further positive is growing evidence of job generation
- Top-tier IT service companies hired a net of 55,000 people in Q1’FY22
He further adds developers are facing margin pressure due to inflation even with increased pricing, demand has stayed resilient.
Meanwhile, hiring activities in India, as measured by the Naukri JobSpeak Index calculated by the leading job listing website Naukri, rose by 89% YoY in August and is now up 24% compared with the pre-Covid level in August 2019.
