Nifty 50 Most Expensive Among Asian Peers
Nifty 50 index trades at higher forward valuations.
The Nifty 50 Index, which has gained over 7 percent year-to-date, is the most expensive among benchmark indices in emerging markets in Asia.
The Nifty 50 is trading at a forward price-to-earnings ratio of 19.5 times, the highest when compared to benchmarks of the Philippines, Malaysia, Indonesia, Thailand, Taiwan, China and South Korea.
It is followed by the Philippine benchmark index (17.3 times). The cheapest among the emerging Asian countries is South Korea’s KOSPI index, which is trading at forward price-to-earnings ratio of 9.7 times.
An index or a company with a relatively higher forward price-to-earnings ratio is termed expensive, which means investors are willing to pay more for earnings in return.
The reason behind Nifty 50’s high forward PE ratio is that India is projected to grow at 6.8 percent in FY17, the fastest among its Asian peers.