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Indian equities more expensive than emerging market peers: RBI's FSR report

According to experts, the gap between underlying corporate earnings and share prices has widened to a multi-year high

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The Sensex, for instance, may end the year at a price-earnings (P/E) multiple of 29x, the highest in 25 years

Ashley Coutinho Mumbai
Emerging markets’ (EMs’) equities look attractive from a valuation perspective relative to those of developed markets despite the wedge in earnings per share between the two groups, according to the FSR.
 
That said, the valuation of Indian equities vis-à-vis its EM peers seems to be somewhat expensive. The high valuations of the benchmark indices will be sustainable only if there is a steady rise in corporate earnings, the report observes.
 
The quarterly earnings per share growth of the S&P BSE 500 Index went up in the quarter ended September 2019 on a y-o-y basis, although the same for