Some adjustments has been made to Indian holdings portfolio: Christopher Wood

Christopher Wood, managing director and chief strategist of CLSA said with the Reserve Bank of India ( RBI) monetary policy meeting pending on Tuesday, some adjustments has been made to the Indian holdings in the Asia ex-Japan long-only portfolio.

“The investments in Grasim Industries and Power Finance Corporation will be removed. They will be replaced by initiating a three percentage point weighting in Coal India, and a three percentage point weighting in Bajaj Finance. The existing weighting in Maruti Suzuki will also be increased by one percentage point,” Wood added.

Wood on RBI monetary policy meeting said “the consensus is for a 25 basis point cut in the repo rate to 7.25% even though RBI Governor Raghuram Rajan has, on the two occasions he has cut rates this year, acted not at the time of the formal policy meeting.”

This hints at a personal preference to surprise the market, which is the opposite of the behaviour long practiced by the Federal Reserve, be it under Pinball Alan, Billyboy or Chairwoman Yellen, said wood

CLSA strategist further added that he would be amazed if there was not a 25 basis point rate cut. Indeed a 50 basis point cut would be wholly appropriate given the level of real interest rates.