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India: Why investing in this emerging market makes sense

by , 07 February 2013

“It's not all about Africa. What about India?” asks Sascha Planting on moneyweb.co.za. And that's exactly what the investors and companies in South Africa are currently asking. After all, as one of the fastest growing and most populous nations on earth, investing in India makes sense for investors and companies alike. Here's why you should consider investing some of your cash in this emerging market powerhouse.
“I’m sure you’ve heard it before… If you want access to greater growth opportunities, you need to invest offshore,” Gavin Fourie reminds readers on the FSP Invest website.

“And one of the best ways to do so is to invest in emerging markets like India,” he continues.

The #1 reason to invest in India: The country’s just getting richer and richer!

Most investors don’t realise that India is the world’s largest democracy with one of the fastest growing economies in the world. Currently, there are over 50 million Indians with an annual disposable income of between $4,200 and $21,000. And this is expected to grow by ten times over the next decade as India’s growing middle-class gets richer.

South African companies are finally starting to pile into this emerging market.

“Adcock Ingram is the latest in a handful of SA firms bold enough to plant a stake – its second – in this colourful but chaotic economy. The pharmaceutical firm recently invested R745m to acquire Cosme, a mid-sized pharmaceutical company operating across 27 of India’s 28 semi-autonomous states,” says Planting.
 
It’s joining the likes of local companies SAB Miller, Bidvest, FirstRand, Sanlam and Naspers, which already have an established presence in this emerging market.

Why should you invest offshore in 2013?

“With more rand weakness expected, international assets look attractive,” Francois van der Merwe, Head of Macro Research at Novare Investments told Moneyweb.

There are two ways to profit from India’s growth. You can either:
  • Invest directly in the Indian stock market; or
  • Invest in locally-listed South African shares (like those mentioned above).
Whichever you choose, protect your wealth by investing some of your cash in emerging market countries with great growth potential and you’ll be smiling every time the rand takes a beating in the market.


India: Why investing in this emerging market makes sense
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