An electronic display board sits on the side of a public walkway and shows stock movements as pedestrians walk across the structure in Pudong, a district of Shanghai, China. (Photographer: Luke MacGregor/Bloomberg)

Fidelity Finds This Emerging Market More Attractive Than India

Fidelity International finds China more attractive than India among emerging markets despite a threat of a trade war with the U.S.

“Valuations for Indian markets are on the higher side,” Fidelity’s Investment Director Medha Samant told BloombergQuint in an interview. “We find more bottom-up opportunities in China.”

Why China Over India?

There are more investment opportunities in China, according to Fidelity. Samant said there are some stocks that have fallen for no specific reasons amid trade war concerns.

Besides, the multinational financial services corporation finds value among smaller Asean markets. “India certainly has competition for short to medium-term,” Samant said.

Opportunities In India

Even though Samant finds Indian markets expensive, she is confident of its long-term prospects. “India is strictly a stock-specific market.”

Indian markets are resilient due to domestic investors who are keeping it afloat despite headwinds, she said, adding that an investor needs to be patient in order to make money in India.

Samant sees value in private banks and some consumer-focused companies. “We like private banks despite their expensive valuations. This is due to the fact that the froth that was built in mid- and small-cap stocks is not over yet.”

Watch the full interview here