Fed downshift, China easing may cause India to underperform: Raychaudhuri

'Investors are now beginning to understand that on an absolute basis, India is not really that overvalued'

India’s outperformance over the past year is largely due to troubles in the developed world and China. Two pivots — US Federal Reserve’s (Fed’s) downshift and relaxation of Covid restrictions in China — could lead to India’s underperformances, says Manishi Raychaudhuri, head of Asia-Pacific equity research at BNP Paribas. In conversation with Samie Modak, Raychaudhuri says India is expensive on a relative basis, not so much on an absolute basis. Edited excerpts:

What has underpinned India’s outperformance over the past year?
 

Some things have worked in India’s favour. We’re clearly in a period of global economic slowdown, particularly developed market