Advantage India: The Unrealised Opportunity€¦ · India 18% Rest of world 82% Breathtaking pace...

Advantage India:

The Unrealised Opportunity

January 2018

This commentary provides a high level overview of the recent economic environment, and is

for information purposes only. It is a marketing communication and does not constitute

investment advice or a recommendation to any reader of this content to buy or sell

investments nor should it be regarded as investment research. It has not been prepared in

accordance with legal requirements designed to promote the independence of investment

research and is not subject to any prohibition on dealing ahead of its dissemination. The

performance figures displayed in the document relate to the past and past performance

should not be seen as an indication of future returns. Any forecast, projection or target

where provided is indicative only and is not guaranteed in any way. HSBC Global Asset

Management accepts no liability for any failure to meet such forecast, projection or target.

1 11

Why India now?

Any forecast, projection or target where provided is indicative only and is not guaranteed in any way. HSBC accepts no liability for any

failure to meet such forecasts, projections or targets.

India is currently one of the fastest

growing major economies in the

world, having come a long way in

the 25+ years since the country

embraced market-orientated

reforms and opened its doors to

foreign investments. In recent

years, India has demonstrated its

desire to accelerate its economic

growth and create a more

conducive business environment

through a series of key reforms

such as the implementation of a

landmark tax reform and a record

capital injection to shore up its

public banks.

The introduction of these structural

reforms have not been without their

challenges but the government has

persevered, thus paving way for

India to potentially become the

fourth largest economy in the world

by 2022.

This report attempts to outline the

impact of these far-reaching

changes and to examine the

resultant investment opportunities in

both the equity and fixed income

markets, spanning a wide array of

sectors and industries.

2 22

India 18%

Rest of world82%

Breathtaking pace of India’s ascent in numbers

Over 300 million households in

India have opened new bank

accounts since 2014, helped by the

government’s financial inclusion

initiatives.

18% of the world’s working age

population resides in India, and

almost half of its population is under

the age of 25.

There are 217 million active

Facebook users in India. Social

network users in India are expected to

exceed the total population of the US

in 3-4 years.

India is the world’s 2nd largest smartphone market but nearly one

billion Indians still do not own a

smartphone.

India has the world’s second largest

and Asia’s largest railway network,

carrying over 23 million passengers

daily. India’s railway network remains

one of the most underinvested.

The government is targeting to raise

India’s renewable energy to 175 GW by 2022. It has already reached 22% of

the target.

Working age population proportion

The Indian economy is expected to

nearly triple in size to reach US$6

trillion in GDP within 10 years.

By 2025, India’s middle class is

expected to double to 550 million

people, which is equivalent to the

current population of the United

States, the United Kingdom, Germany

and France combined.US$ 2.2 trillion

US$ 6 trillion

2016 2026F

Source: World Bank as of December 2017, HSBC Global Asset Management as of December 2017, HSBC Global Research as of

September 2017, Harvard Business Review as of November 2017, Economic Times as of November 2017, Facebook Quarterly Earnings

3Q 2017, Ministry of Railways India, Morgan Stanley as of September 2017, Renewables Now as of September 2017



3 33



India is growing at the highest pace

among large economies

India is outpacing China and becoming the

world’s fastest growing economy1. The world

in 2022 may see India surpass France,

United Kingdom and Germany to become the

fourth largest economy.

Real GDP Growth 2018 Forecast

6.7 6.5

3.02.6 2.5

2.2 2.1 1.9 1.81.4 1.3

3.7

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

India

Chin

a

So

uth

Kore

a

US

A

Bra

zil

Canada

Eu

ro

Russia

Fra

nce

UK

Jap

an

World

%

India is increasingly becoming a

preferred investment destination

Foreign direct investment (FDI) inflows into

India have been on a robust growth trajectory.

While China currently attracts a higher level

of FDI, India’s FDI growth compared to

China’s has been phenomenal. Strong FDI

inflows are enhancing India’s productivity,

funding its current account, and improving its

macro stability.

FDI net inflows 2013 vs. 2017

USD 20 billion

USD 36 billion

FY2013 FY2017

USD 112billion

USD 124billion

FY2013 FY2017

India China

Indian start-up ecosystem is the

world’s third largest

Indian entrepreneurship continues to thrive as

India retains its place as one of the largest

start-up bases in the world, ranking only

behind the United States and the United

Kingdom. India is seeing a rapid rise in the

tech space, with over 1000 tech start-ups

added in 2017, bringing the total to around

5200.

Advantage India

Note 1: Large economies defined as 2016 nominal GDP

exceeding US$1.28 trillion. Source: Bloomberg, World Bank,

HSBC Global Asset Management, as of January 2018

FY = fiscal year from 1 April to 31 March. Reserve Bank of India,

Ministry of Finance People’s Republic of China, HSBC Global

Asset Management as of December 2017

Source: Nasscom as of November 2017

Healthy growth of start-ups in 2017

Net inflows up by 79.7% Net inflows up by 10.6%

Favourable demographics are

powering consumption

Consumption is the largest contributor to

India’s GDP and will continue to be a growth

driver in the coming years. A growing working

age population, rising urbanisation and

increasing levels of income would continue to

power consumption growth across sectors.

Consumption37%

Investment45%

Government14%

Net exports

4%

Consumption59%

Investment30%

Government12% Net

exports-1%

Source: HSBC Global Research as of September 2017

India:

Economic makeupChina:

Economic makeup

31%28%

13%

5%

15%

25%

35%

Fin-tech Health-tech ecommerce

% growth year-on-year

4 44

Monetary and fiscal reforms

Objectives

Progress & impact

Improvement seen across key macro

indicators:

Improve

transparency &

accountability of

monetary policy

Goods and services tax (GST)

Objectives

Progress & impact

Make in India / Ease of Doing

Business

Objectives

Progress & impact

Reform focus

Since assuming office in 2014, the Modi government has placed substantial focus on

structural economic reforms. Highlighted here are four sets of key reforms that are

impacting the economy and financial markets.

Bank recapitalisation and

bankruptcy law

Objectives

Progress & impact

Improved tax

collections are

expected

9.0

10.0

11.0

12.0

FY

15

FY

16

FY

17

FY

18E

FY

19E

FY

20E

India climbing

the ranks of

World Bank’s

ease of doing

business index

Source: World Bank Doing Business 2018 report

FY= fiscal year 1 April to 31 March. Source: HSBC Global

Asset Management as of December 2017

FY= fiscal year 1 April to 31 March. Source: PIB, Business Line,

MTEF of Union Government, YES BANK as of August 2017

FY2013 FY2017

Consumer price

inflation (yoy increase)9.9% 4.5%

Fiscal deficit (% of GDP) 4.9% 3.5%

Current account

balance (% of GDP)-4.8% -0.7%

Foreign exchange

reserves (in billion)USD 260 USD 346

Address public sector

banks’ capital

adequacy issues

Create a single law

for insolvency &

bankruptcy

Reorient economy

from unorganised

to organised

Simplify

tax

structure

Increase

tax

compliance

Increase government

spending on

infrastructure and focus

on fiscal consolidation

Make India

a major design and

manufacturing hub

Improve

ease of doing

business

Robust growth in FDI

The government is

targeting reforms in all 10

categories of Doing

Business, including starting

a business, dealing with

construction permits, and

registering property 2016 2017 2018

100th

130th131st



Expected to

increase tax base

Expected to reduce

systemic leakage

Expected to reduce

logistics and

administrative

bottleneck

Bank recap is expected to strengthen public

sector banks

Bank recap is a major stimulant for corporate

profits and economic growth

Bankruptcy law provides effective and timely

process for lenders to restructure NPAs

Improved environment for business and

settlement of claims; increased FDI

NPAs = non-performing assets. Source: HSBC Global Asset

Management as of January 2018

Centre gross tax

revenues (% of GDP)

5 55

Retail landscape: Transforming and

strengthening

Structural reforms (including GST), increasing

income, rising urbanisation, and large working

population are some of the key drivers that

will further propel the growth of organised

retail in India. Organised retail currently

makes up a low percentage of India’s retail

industry, presenting an immense growth

potential for the segment.

Organised9%

Unorganised91%

Household savings structure: Shift

to financial assets

Domestic households are reducing their

allocation to physical assets such as real

estate and gold, given positive real rates.

Instead, exposure to financial savings has

been on the rise, indicating a shift in the

savings structure that is beneficial for

economic growth.



Digitalisation of the economy

Digitalisation is surging in India, with digital

transactions increasing at 77% compounded

annual growth rate (CAGR) over the past four

years. Smartphone penetration has also more

than doubled in the last three years.

However, overall levels of digital use in India

are still low relative to other major nations,

creating a huge growth opportunity for the

digital space as India continues to develop

and catch up to other countries.

INR billion

0

5,000

10,000

15,000

20,000

25,000

FY

2013

FY

2014

FY

2015

FY

2016

FY

2017

Credit cards Debit card POS m-wallet Mobile banking

FY = fiscal year from 1 April to 31 March. Source: Reserve

Bank of India, CLSA, HSBC Global Asset Management, August

2017

Spotlight on structural shifts

Digital Payments

Internet penetration

Source: We Are Social, Internet World Stats, International

Telecommunication Union, Internet Live Stats, CIA World

Factbook, Facebook, National Regulatory Authorities as of

January 2017

Distribution of household savings

FY = fiscal year from 1 April to 31 March. FY2017 physical

savings are based on estimates. Source: Reserve Bank of

India, HSBC Global Asset Management, December 2017

Canada

91%

USA

88%

Brazil

66%

UK

92%

Germany

89%

Russia

73%

Japan

93%China

53%

South Korea

90%

Australia

87%

India

35%

South Africa

52%

Mexico

59% Nigeria

51%

Saudi Arabia

70%

Source: IBEF as of November 2017

Retail industry

penetration

31%

33%

36%

36%

41%

44%

69%

67%

64%

64%

59%

56%

FY2012

FY2013

FY2014

FY2015

FY2016

FY2017

Financial savings Physical savings

6 66

Banks

Private sector banks: The outlook is positive

for select private banks that have the best-in-

class retail deposit franchises but are

currently underappreciated by the market.

Public sector banks: Confidence in the

banking sector was boosted by a recent move

by the government to inject a record US$32

billion worth of capital into public sector

banks.

Household credit

Urbanisation, rising incomes, as well as

supportive government initiatives have

pushed up the demand for affordable housing

in India. There exists an emerging opportunity

for the housing finance sector, particularly

with housing affordability for middle and low

income housing at one of its best levels in the

last two decades, reaching a 28% mortgage

payment to post-tax income ratio in FY2017

versus 36% in FY2012. Mortgage penetration

in India is also the lowest amongst major

economies at only 9% of GDP.

Investment opportunities

Germany

42%

Australia

93%USA

68%

China

18%India

9%

Autos

The Indian automobile industry is currently

ranked fifth in the world. Favourable

conditions will continue to support the

industry’s prospects, including:

1. Strong demand arising from increasing

income and young population

2. Robust FDI investments and allowing

100% foreign ownership in the sector

3. Government support, with Automotive

Mission Plan 2026 targeting a fourfold

growth in the industry

4. Focus on electric vehicles (EV) with

ambitious government target of 40% EV

penetration by 2032

Industrials

Industrials in India are seeing improved

conditions, as consumer demand is strong,

exports are recovering and capital investment

in the sector is rising. A key driver for the

sector is the current government’s thrust on

infrastructure building including railways,

roads, urban transportation and airports.

Further, lower cost of capital and better

legislative environment are important supply-

side catalysts.

GDP contribution 7.1%

Manufacturing GDP contribution 22%

2017-2026 forecast CAGR of

passenger vehicles domestic

sales

12.9%

India autos

5

10

15

20

FY13 FY14 FY15 FY16 FY17BE FY18E

USD billion

Capex growth for Indian railwaysPublic sector banks expected to be stronger

following bank recapitalisation

Mortgage penetration

as % of GDP

Source: CLSA as of August 2017, HSBC Global Asset

Management as of November 2017 Source: IBEF as of November 2017

Source: HSBC Global Asset Management as of November 2017 Source: JP Morgan, Ministry of Railways, Economic Times as of

January 2017



1. Clean up balance sheets

2. Speed up resolution of bad loans

3. Meet Basel III requirements

4. Increase propensity to lend

5. Improve profitability

7 77

Indian equities: a US$2.2 trillion

market is underrepresented

India’s economy is one of the world’s largest

but its equity market representation in the

MSCI AC World Index remains at only 1.0%.

This means there is potential for a sizeable

increase in the index weight in the coming

years.

CountryWorld GDP

contribution (%)

MSCI AC World

Index weight (%)

United States 24.6 51.0

Japan 6.5 7.9

United Kingdom 3.5 5.4

China 14.8 3.1

Australia 1.6 2.3

South Korea 1.8 1.8

Hong Kong 0.4 1.5

India 3.0 1.0

Relative valuations remain

reasonable

India’s equity market has historically traded at

a premium relative to Asia ex Japan (AXJ),

which can be attributed to historically higher

return-on-equity as well as a more diversified

market composition as compared to the

region.

0.9

1.4

1.9

1/1

3

5/1

3

9/1

3

1/1

4

5/1

4

9/1

4

1/1

5

5/1

5

9/1

5

1/1

6

5/1

6

9/1

6

1/1

7

5/1

7

9/1

7

5-year average = 1.48

Now = 1.55

Championed by domestic investors

Achieve portfolio diversification with Indian equities

India’s equity market

India USA EuropeDeveloped

markets

Emerging

marketsAsia China

India 1.00

USA 0.44 1.00

Europe 0.39 0.70 1.00

Developed markets 0.47 0.96 0.85 1.00

Emerging markets 0.56 0.65 0.49 0.65 1.00

Asia 0.54 0.78 0.70 0.86 0.80 1.00

China 0.37 0.55 0.36 0.55 0.90 0.77 1.00

Institutional investors 2016 2017

Foreign 2.9 7.6

Domestic 5.3 14.0

Note: Correlation is calculated using monthly returns of respective MSCI local currency indices from December 2013 to December

2017. Source: Bloomberg, HSBC Global Asset Management, data as of December 2017

Note: GDP data is based on 2016 calendar year GDP.

Source: Bloomberg, World Bank, HSBC Global Asset

Management, data as of December 2017

Source: Bloomberg as of December 2017



Fund flows into equities (in USD billions)

Correlation matrix of major equity markets

Equity representation vs GDP contribution

India’s P/E premium vs

Asia ex Japan

India AXJ

ROE 14.1% 11.6%

Forward

EPS growth19.4% 12.5%

Note: Respective equity markets are represented by MSCI

Indices. Source: Bloomberg, HSBC Global Asset

Management as of December 2017

Equity market composition

0%

20%

40%

60%

80%

100%

AXJ China India

Health Care

Utilities

Telecommunication Services

Energy

Materials

Consumer Staples

Real Estate

Industrials

Consumer Discretionary

Financials

Information Technology

India/AXJ P/E

8 88

Indian bonds offer attractive bond

yields

In a low yield global environment, Indian

bonds offer a premium to other markets, with

an attractive 7.32% yield on its 10-year

government bonds.

India’s bond market

Sovereign credit ratings on the rise


failure to meet such forecasts, projections or targets

Indian bond market:

large and diversified

The Indian bond market has grown rapidly

and has surpassed USD 1.1 trillion in size.

While 66% of the market is made up of

government bonds, the corporate market is

likely to grow strong in the coming years.

30

40

50

60

70

0

200

400

600

800

1,000

1,200

1,400

09/1

2

09/1

3

09/1

4

09/1

5

09/1

6

09/1

7

Government bonds

Corporate bonds

GDP

Source: Bloomberg, data as of 29 December 2017

Yield (%)USD billion

Source: HSBC Global Research as of September 2017

Long term rating Economic outlook Date

Moody's Baa2 Stable Nov 2017

Fitch BBB- Stable May 2017

S&P BBB- Stable Sep 2014

Source: Moody’s, Standard & Poor’s, and Fitch ratings, as of 31 December 2017

Market access Major issuers • Government bonds (51%)

• State Government bonds (24%)

• Corporate bonds (25%)

Market access by

foreign investors

• Foreign Professional Investors (FPI) can access market via an FPI license

from a Designated Depository Participant (DDP)

• Coupons and capital gains are taxed

Foreign ownership 4.29%

Impact of government

regulation

• Total FPI government securities limit set at 5% of total outstanding bonds1.

The quota is reviewed every 6 months and released every quarter

• FPIs can invest in dated government securities and corporate bonds having

residual maturity of 3 years or above

• Reserve Bank of India (RBI) has opened up State Development Loans (SDLs)

and Masala bonds to foreign investors

Note 1: Denominated in INR terms

Source: AsiaBondsOnline, Reserve Bank of India, HSBC Global Research, HSBC Global Asset Management, as of November 2017

Bonds outstanding 10-year government bond yields

0

1

2

3

4

5

6

7

8

Russia

India

Indonesia

Bra

zil

Ma

laysia

Chin

a

New

Ze

ala

nd

Au

str

alia

US

A

Th

aila

nd

Canada

Sin

ga

pore

UK

Fra

nce

Germ

any

Jap

an

GDP %

9 99

India is quickly emerging as a major economic powerhouse, fueled by many important

factors, one of which is its incredible population size. With 29 states and a total

population of 1.3 billion people, India can be thought of as a country of countries. The

below map provides our global audience with an idea of how the people of India are

spread out across its states and territories by illustrating population in country equivalent

terms.

A country of countries

Source: IIFL, CEIC, The Economist, World Bank, HSBC Global Asset Management as of January 2018

Less than 25 25 - <50 50 - <75 75 - <100 100 or more

Population (millions)

Country equivalent

(Indian state/territory)

India’s population is equivalent to:

= European Union × 2.6

= North America × 3.7

= Latin America & Caribbean × 2.1

= Middle East & North Africa × 3.0

Somalia

(Jammu and Kashmir)

Bulgaria

(Himachal Pradesh)

Malaysia

(Punjab) Belgium

(Uttarakhand)

Yemen

(Haryana)Romania

(Delhi)

Brazil

(Uttar Pradesh)Thailand

(Rajasthan)

France

(Gujarat) Germany

(Madhya Pradesh)

United Kingdom

(Karnataka)

Peru

(Chhattisgarh)

South

Africa

(Andhra

Pradesh)

Argentina

(Odisha)

Slovenia

(Goa)

Japan

(Maharashtra)

Bahrain

(Puducherry)

Philippines

(Bihar)

Poland

(Jharkhand)Vietnam

(West

Bengal)

Mauritius

(Sikkim)

Morocco

(Assam)

Gambia

(Arunachal Pradesh)

Macedonia

(Nagaland)

Mongolia

(Manipur)

Uruguay

(Meghalaya)

Cyprus

(Mizoram)

Canada

(Kerala)

Turkey

(Tamil Nadu)

Kuwait

(Tripura)

Bermuda

(Lakshadweep)

The Bahamas

(Andaman and Nicobar Islands)

South Korea

(Northeast India)

Algeria

(Telangana)

10 1010

HSBC Global Asset ManagementIndian Investment Capabilities

Key strategies Indian equity Indian fixed income

Key proposition

High conviction and diversified Indian

equity portfolio with differentiated

strategy

Invests in Indian fixed income across

the credit spectrum, in both onshore

and offshore markets

Approach

Bottom-up fundamental approach

Concentrated positions with below

average valuation for a given level

of profitability

Integrated approach towards

fundamental research and local

insight

Robust rate process

Investment universe

Equities of companies domiciled,

based or carrying out large part of

business in India

Investment grade, high yield, and

unrated INR bonds, including

corporates and government

Investment grade, high yield, and

unrated bonds in other currencies

hedged back to INR, including

corporates and government

Source: HSBC Global Asset Management, data as of December 2017

Why active management with HSBC?

Indian

equities:

Attractive combination of profitability and valuation – Concentration of

overweight positions in profitable companies at below-average valuations,

enhancing returns over the long run

Strong fundamental focus – Significant value added with strong fundamental

focus, which is supported by high quality research

Indian

fixed income:

Rigorous credit selection and risk management – An integrated approach

towards fundamental research and local insight that marries rigorous credit

selection with stringent risk controls

Robust rate process – Investment views formulated through extensive analysis of

economic fundamentals, central bank policies and liquidity, to derive appropriate

rate strategy for the portfolio; process is fully supported by the on-the-ground

investment team in India

Emerging

markets

expertise:

HSBC Global Asset Management is one of the largest managers of emerging

market assets. HSBC Group’s longstanding brand equity in the emerging world

provides a unique level of access to management teams as well as a nuanced

understanding of local politics, cultures, and markets

Reputation and

brand equity

open doors:

The actively managed portfolios benefit from goodwill and strong relationships that

come with being a part of the HSBC Group

Note: In addition to the key strategies showcased, HSBC Global Asset Management offers a full suite of

offshore and onshore products related to Indian investment capabilities, including multi-asset, infrastructure,

liquidity, and equity small/mid cap

11 1111

The value of investments and any income from them can go down as well as up and

investors may not get back the amount originally invested.

• Exchange rate risk: Investing in assets denominated in a currency other than that of the

investor’s own currency perspective exposes the value of the investment to exchange rate

fluctuations.

• Liquidity risk: Liquidity is a measure of how easily an investment can be converted to cash

without a loss of capital and/or income in the process. The value of assets may be significantly

impacted by liquidity risk during adverse market conditions.

• Emerging market risk: Emerging economies typically exhibit higher levels of investment risk.

Markets are not always well regulated or efficient and investments can be affected by reduced

liquidity.

• Derivative risk: The use of derivatives instruments can involve risks different from, and in

certain cases greater than, the risks associated with more traditional assets. The value of

derivative contracts is dependent upon the performance of underlying assets. A small

movement in the value of the underlying assets can cause a large movement in the exposure

and value of derivatives. Unlike exchange traded derivatives, over-the-counter (OTC)

derivatives have credit and legal risk associated with the counterparty or the institution that

facilitates the trade.

• Operational risk: The main risks are related to systems and process failures. Investment

processes are overseen by independent risk functions which are subject to independent audit

and supervised by regulators.

• Concentration risk: Funds with a narrow or concentrated investment strategy may experience

higher risk and return fluctuations and lower liquidity than funds with a broader portfolio.

• Interest rate risk: As interest rates rise debt securities will fall in value. The value of debt

securities is inversely proportional to interest rate movements.

• Derivative risk (leverage): The value of derivative contracts depends on the performance of an

underlying asset. A small movement in the value of the underlying can cause a large movement

in the value of the derivative. Over-the-counter (OTC) derivatives have credit risk associated

with the counterparty or institution facilitating the trade. Investing in derivatives involves

leverage (sometimes known as gearing). High degrees of leverage can present risks to sub-

funds by magnifying the impact of asset price or rate movements.

• Emerging market fixed income risk: Emerging economies typically exhibit higher levels of

investment risk. Markets are not always well regulated or efficient and investments can be

affected by reduced liquidity, a measure of how easily an investment can be converted to cash

without a loss of capital, and a higher risk of debt securities failing to meet their repayment

obligations, known as default.

• High yield risk: Higher yielding debt securities characteristically bear greater credit risk than

investment grade and/or government securities.

• Contingent Convertible Security (CoCo) risk: Hybrid capital securities that absorb losses when

the capital of the issuer falls below a certain level. Under certain circumstances CoCos can be

converted into shares of the issuing company, potentially at a discounted price, or the principal

amount invested may be lost.

Key Risks

12 1212

Important information

The contents of this document may not be reproduced or further distributed to any person or entity, whether in whole or in part,

for any purpose. All non-authorised reproduction or use of this document will be the responsibility of the user and may lead to

legal proceedings. The material contained in this document is for general information purposes only and does not constitute

advice or a recommendation to buy or sell investments. Some of the statements contained in this document may be considered

forward looking statements which provide current expectations or forecasts of future events. Such forward looking statements

are not guarantees of future performance or events and involve risks and uncertainties. Actual results may differ materially

from those described in such forward-looking statements as a result of various factors. We do not undertake any obligation to

update the forward-looking statements contained herein, or to update the reasons why actual results could differ from those

projected in the forward-looking statements. This document has no contractual value and is not by any means intended as a

solicitation, nor a recommendation for the purchase or sale of any financial instrument in any jurisdiction in which such an

offer is not lawful. The views and opinions expressed herein are those of HSBC Global Asset Management and are subject to

change at any time. These views may not necessarily indicate current portfolios' composition. Individual portfolios managed by

HSBC Global Asset Management primarily reflect individual clients' objectives, risk preferences, time horizon, and market

liquidity.

The value of investments and the income from them can go down as well as up and investors may not get back the amount

originally invested. Past performance contained in this document is not a reliable indicator of future performance whilst any

forecasts, projections and simulations contained herein should not be relied upon as an indication of future results. Where

overseas investments are held the rate of currency exchange may cause the value of such investments to go down as well as

up. Investments in emerging markets are by their nature higher risk and potentially more volatile than those inherent in some

established markets. Economies in emerging markets generally are heavily dependent upon international trade and,

accordingly, have been and may continue to be affected adversely by trade barriers, exchange controls, managed adjustments

in relative currency values and other protectionist measures imposed or negotiated by the countries with which they trade.

These economies also have been and may continue to be affected adversely by economic conditions in the countries in which

they trade. Mutual fund investments are subject to market risks, read all scheme related documents carefully.

We accept no responsibility for the accuracy and/or completeness of any third party information obtained from sources we

believe to be reliable but which have not been independently verified.

Copyright © HSBC Global Asset Management Limited (Hong Kong) 2018. All rights reserved. No part of this publication may be

reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying,

recording, or otherwise, without the prior written permission of HSBC Global Asset Management Limited.

Issued by HSBC Global Asset Management (Hong Kong) Limited

Important information

Advantage India: The Unrealised Opportunity€¦ · India 18% Rest of world 82% Breathtaking pace...

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