India has surpassed China as the fastest growing major economy across the entire world, after seeing its economy expand 7.3% in 2015. According to Delhi’s Central Statistics Office, the economy of the world’s second-most populous country was anticipated to reach a growth rate of 7.6% in 2016, higher than the 7.2% rate in 2014. Earlier this year, analysts at Goldman Sachs were recommending an Overweight position in Indian equities relative to those of other Asian counterparts, suggesting that strong consumption demand and government spending may support corporate profits.
That said, it might seem like a great idea to include some Indian equities in one’s equity portfolio, but how would one go about identifying stock winners in an unknown equity market? One could find possible winners by attending or closely following the upcoming inaugural Sohn India Investment Conference (register here), which will be held on June 3 in Mumbai, where attendees will have the chance to listen to market insights and investment ideas from top investors from India and around the world. Similar to the original Sohn Investment Conference in New York City, the Sohn India Conference raises money to support cutting-edge pediatric cancer care in India.
One can also find possible winners in the Indian equity market by looking at the most favored Indian stocks listed on U.S. exchanges, so this article will solely focus on five most-loved Indian stocks among the hedge funds tracked by Insider Monkey.
At Insider Monkey, we track around 730 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details about our small-cap strategy).
#5. Videocon d2h Ltd – ADR (NASDAQ:VDTH)
– Investors with long positions: 14
– Aggregate value of investors’ holdings: $136.33 Million
There were 14 hedge funds tracked by Insider Monkey with stakes in Videocon d2h Ltd – ADR (NASDAQ:VDTH) at the end of December, as compared to 19 recorded at the end of September. Videocon shareholders may not have been quite happy with the company’s stock performance since it became the first Indian media company to list on the NASDAQ in April 2016, but Videocon’s American Depositary Shares (ADSs) have gained an impressive 41% in the past three months. Even so, the ADS has declined by 22% in the past 12 months. Videocon d2h’s business operations involve providing direct-to-home services to subscribers, with the company being the fastest growing pay TV company in India. With a total number of 15 million subscribers as of the end of December, Videocon d2h appears to have more room to expand considering the potential pay TV subscriber market of at least 100 million subscribers. Jim Simons’ Renaissance Technologies LLC owns 188,100 ADSs of Videocon d2h Ltd – ADR (NASDAQ:VDTH) as of March 31.