Press release
Ashmore launches two funds to provide access to significant investment opportunities in India
Strategy benefits from a local presence and a 28-year established track record of investing in listed Indian equities
Mumbai / London, 29 May 2024
Ashmore Group plc (“Ashmore”, “the Group”) has launched Ashmore India Equity Fund, focused on the significant investment opportunities available in the Indian domestic equity market.
The strategy is available as both a Luxembourg domiciled UCITS SICAV (“the SICAV”) for global asset allocators and a Category 3 Alternate Investment Fund (AIF)1 catering to local Indian investors, which will be managed by the Group’s local asset management business, Ashmore India. The Ashmore India investment team, based in Mumbai, has experience in successfully advising clients and managing Indian equity mandates for the past 28 years and as of 31 March 2024 oversees investments of USD 1.7 billion in publicly listed Indian equities.
The SICAV provides an opportunity for investors to diversify away from countries such as China while retaining or increasing exposure to potentially attractive Emerging Market opportunities. The category 3 AIF meets broadening domestic equity market participation, evidenced by monthly mutual fund flows exceeding USD 2 billion.
India continues to deliver rapid and broad-based economic growth underpinned by consumption, investment, government spending and exports. The market is highly diversified and dynamic with strong secular growth drivers, and therefore stock selection through active management is paramount given divergent valuations across the market cap spectrum.
While India has always been considered an important growth market, and this underpins longer-term market appreciation, Ashmore India follows a differentiated investment approach. Guided by its Intrinsic Value Framework2, the team believes in buying quality businesses that are currently undervalued by the market and which therefore can offer substantial upside. The portfolio construction is market cap and sector agnostic, with a focus on bottom-up analysis driving stock selection to deliver sustained alpha over the market cycle.
India’s equity market has outperformed the MSCI EM index by 700bps annualised over the past decade, and further outperformance is underpinned by consistently strong GDP growth of 6%-7% per annum, a resilient and broad-based corporate earnings profile, and robust capital flows from both domestic and foreign investors.
Rashi Talwar Bhatia, CEO of Ashmore India, commented:
“Active management and stock selection are key to outperforming across Emerging Markets. Ashmore’s new strategy builds on a long-term commitment to India, providing international and domestic investors with access to the highly attractive investment opportunities currently available in the fastest growing economy in the G-20. Ashmore India’s investment team has a long track record of generating alpha for clients through its distinctive Intrinsic Value Framework, which will drive portfolio construction in these funds and provide the potential for outperformance over the market cycle.
“With the likelihood of a third successive government led by BJP, India provides reassurance amid geopolitical uncertainty elsewhere in the world and Ashmore’s Emerging Markets specialism can provide access to the attractive growth opportunities this presents.”
1. Ashmore’s Intrinsic Value Framework targets mispriced businesses with structural growth catalysts. Due to internal or external factors, a company’s market value may trade at a discount to its intrinsic value. The framework enables Ashmore to identify such mispriced businesses and to generate long term alpha for its clients.
2. A Category 3 AIF is a privately pooled investment vehicle, registered with SEBI in India, that invests in the listed Indian equity universe.