Large EMs like China, Brazil, Russia have their own issues, but India better positioned: Girish Pai

In an interview with ET Now, Girish Pai, Head of Research, Nirmal Bang Institutional Equities, shares his views on markets. Excerpts:

ET Now: Would there be reasonable enough estimate if the loose monetary policy from Bank of England (BOE), Bank of Japan (BoJ) continues, should it augur well?

Girish Pai: This might have had an impact few years back but I think it will happen now. The thing that is probably helping India right now is a situation that the others are not performing well enough. India is like a high quality stock which trades at fairly high PE multiples premium to the other emerging markets and justifiably so because you have good ROEs coming out, reasonable earnings growth and reasonable GDP growth coming through, whereas you have Brazil or Russia among the BRIC countries which is on the recession right now. China is facing its own set of problems and one really does not know whether its GDP number should be believed or not.

So, there are these kind of issues among the large emerging markets, whereby India is in a different place altogether. So, if you ask me whether a 17.5-18 times PE multiple would be justified in the current context, I would say yes. Relatively we may have slow earnings growth but it is more visible and if you look at top-down perspective, we still have 7-7.5% kind of GDP growth coming through.