CLSA Report: The world’s famous investment and brokerage firm CLSA has come out with a report regarding investment in India which can make investors happy. The most important thing in this is that CLSA said that they consider their approach of investing in China more than India as a mistake. In the report, CLSA has said that we have decided to withdraw our step of giving priority to China as an investment destination instead of India. However, the reason behind this is not only the signals coming from India but also the changing global scenario.
CLSA hinted towards future trade war with America
At present, after the news of the arrival of Trump 2.0, the situation is becoming unfavorable for China. After the arrival of newly elected President Donald Trump in America, the store of problems for China is definitely going to increase. They are saying this because Trump has estimated to impose 60 percent tariff on most of the Chinese exports coming from China. In such a situation, the export incident from China will be like a shock to the Chinese economy and after this, China’s exports will have to suffer the loss due to increase in duty.
What does ‘Pouncing Tiger, Prevaricating Dragon’ mean?
- In the report published by CLSA named Pouncing Tiger, Prevaricating Dragon, three main things have been mentioned like
- India will suffer less loss than China in the China-India tariff war.
- Due to the rising value of the dollar after the decision on bond yields and interest rates of the Federal Reserve in America, it will be beneficial to give preference to investing in rupees.
- After the news of relief package in China in September, an overweight view of China was made compared to India. However, now after two months, like before, the investor view on India is overweight.
Why is it a good decision for India
CLSA’s positive outlook for India clearly means that now FII investors will be encouraged to invest more in India instead of China. If seen in true sense, this is a kind of homecoming of CLSA and it has accepted its mistake and reversed its decision.
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