Nifty trades higher than expected; India's valuation gets 'less attractive'

After a 70 per cent rebound from March lows, India’s valuation is now above the long-term average. Foreign brokerage UBS has ranked Asian markets based on how their 12-month forward price-to-earnings (P/E) ratio compared to the 10-year average. The study showed Malaysia, Hong Kong, and Indonesia currently trade much below their long-term averages, making them attractive bets for Asia-focused investors. On the other hand, China, India, and Thailand are the most expensive if one looks at the P/E ratio relative to history. The Nifty currently trades at 21.4x its estimated 12-month forward earnings. The index’s 10-year average is about 17x.