TORONTO, Dec. 22, 2014 /CNW/ - Excel Funds Management Inc.
("Excel") is pleased to announce that the Indian economy is
set to expand next year, growing at a rate of approximately 7% to
8%, up from the current rate of 5.5%, while growth in the global
economy is expected to moderate to about 3%.
Excel manages the Excel India Fund, the largest and
longest-running mutual fund in Canada solely focused on investing in
India. The Excel India Fund is the best performing mutual
fund in Canada, as at November 30th, 2014, according to the
GlobeFund and Morningstar Canada
websites.
"The implementation of a comprehensive reform program that
proposes to remove the barriers to growth, support massive
infrastructural development and encourage foreign and private
investments by India's new
business friendly government will provide impetus for stronger
growth," says Bhim D. Asdhir, President and CEO of Excel Funds
Management Inc.
In addition, says Asdhir, "India is also a big beneficiary of lower oil
prices. As a major net importer of oil, lower prices will result in
lower inflation and consequently lower interest rates – which will
in turn result in more disposable incomes in the hands of
consumers," he says. "At a macro level, the country will experience
a significant improvement in its current account and fiscal
deficits, supporting a strengthening currency; and corporations
will see an improvement in earnings, driving equity prices higher."
Oil prices declined to a 5-year low in November on the back of
forecasts of deteriorating global demand.
The positive impact of lower oil prices on the Indian economy is
supported by the Bank of America Merrill Lynch's research which
shows that a 5% drop in oil prices reduces Indian inflation by 45
basis points; and for each $10 per
barrel fall in oil price, the country's current account will
decline by 0.4% and its fiscal deficit by 0.1%. The investment bank
notes that there have been 11 occasions since 1991 where the price
of Brent crude has corrected by more than 20% in 3 months. On 8 of
these 11 occasions, the Indian equity markets provided an average
return of nearly 17% over 3 months.
Given the positive developments in India, "we believe the Sensex, India's benchmark Index, will double in just
over four years as a result of strong earnings growth," Asdhir
contends. He adds, "Indian companies are expected to generate the
strongest earnings growth in 2015, averaging 16%, compared to less
than 10% for many developed markets."
Asdhir anticipates that the Excel India Fund will continue to
benefit from the superior performance of the Indian equity market
which is currently the best performing in the world and is forecast
to continue to outperform next year. "The Indian super cycle is now
beginning and Canadian investors should seize the opportunity now
to benefit from potentially superior long-term returns in
India," he says.
About Excel Funds
Established in 1998, Excel is a pioneer in investing in emerging
markets in Canada, offering the widest selection of emerging
markets funds to Canadian investors. Through its network of
sub-advisors, Excel has access to over 200 local portfolio managers
and analysts around the world. Excel's on-the ground sub-advisors,
proprietary asset allocation model and best-in-class portfolio
managers contribute to the firm being recognized as "Your Authority
in Emerging Markets" in Canada.
SOURCE Excel Funds Management Inc.