Jefferies’ Christopher Wood, the firm’s global head of equity strategy, is sending a strong signal to investors: “It’s Time to Buy India, Not Sell.” His message comes amid rising geopolitical tensions, fresh U.S. tariffs on Indian imports, and volatile market sentiment. But according to Wood, this is precisely the moment investors should lean into Indian equities rather than shy away. Let’s dive into why.
Why “Buy India, Not Sell”?
Tariffs Are Temporary But India’s Story Is Structural
Despite the U.S. imposing a hefty 50% tariff on Indian imports, Wood argues this is not a cause for panic, but rather a buying opportunity. He believes it’s only a matter of time before the U.S. reverses the stance, as prolonged tariffs are not in America’s strategic interest. In his Greed & Fear note, he confidently adds:
“It is only a matter of time before Trump backs off the stance, which is not in America’s interest.” (The Economic Times, The Economic Times)
India’s Strong Domestic Fundamentals
India’s position as a structurally strong economy driven by powerful domestic demand and growing retail participation makes it less vulnerable to global shocks. A track record of resilience and investor confidence reinforces Wood’s bullish thesis. (Hindustan Times, The Economic Times)
Market Metrics That Support the Argument
Attractive Valuations Amid Underperformance
Currently, Indian equities are trading at a one-year forward P/E of around 20.2x, down from 22.4x earlier. The MSCI India index premium over Asia ex-Japan remains elevated but close to historical norms (67% vs. a 10-year average of 63%). Wood sees this convergence as another reason to view current levels as a strategic entry point. (scanx.trade, The Economic Times)
Managed Equity Supply
India’s equity market saw significant supply in recent months, driven by IPOs and secondary share sales. While such activity could pressure prices, Wood believes the market can absorb this with relative ease a sign of healthy investor demand across the board. (Reuters)
External Forces & Geopolitical Gains
BRICS Strengthening Amid Tariffs
Wood highlights rising geopolitical dynamics, noting that the BRICS alliance seems rejuvenated particularly as India, China, and others respond to global trade friction. “Indeed, BRICS as a grouping has been regalvanised,” he writes. (The Economic Times)
Potential Fed Rate Cut and Currency Tailwinds
July’s encouraging inflation data has raised hopes for a Federal Reserve rate cut in September. Wood sees this as a tailwind for emerging markets like India, coupled with a potential softening U.S. dollar. (The Economic Times)
What This Means for Investors
- Long-Term Opportunity: If you’re looking for structural growth, India remains one of the most compelling long-term equity stories globally.
- Contrarian Play: While tariffs and macro headlines can spook markets, they may actually present the best entry point for savvy investors.
- Diversification Boost: Increasing exposure to Indian equities adds balance and robustness to a portfolio especially amid global trade tensions.
Christopher Wood’s advice to “Buy India, Not Sell” is not just a catchy headline it’s a grounded, data-backed perspective that reflects India’s resilience and promise amidst market turbulence. With temporary fears at play and structural strengths at the forefront, this could mark a pivotal moment for investors looking into emerging markets.
Disclaimer
This article is intended solely for informational purposes and should not be construed as investment advice, solicitation, or recommendation. Any investment or trading decision is entirely the responsibility of the reader. Data, opinions, and references cited in this article are obtained from third-party sources and may change at any time without prior notice. The author and publisher shall not be held liable for any losses or gains arising from the use of the information provided in this article.