updated 5:52 AM UTC, Aug 22, 2017

Nomura India Fund Soars To $3.6 Billion As Japanese Bet On PM Modi

  • Published in India

The demand is so strong that assets of Nomura Holdings Inc.'s India equity fund quadrupled to almost 400 billion yen ($3.6 billion) in just the past year. Japanese investors owned $13 billion of Indian stocks and bonds at the end of June, the most in data going back to 2012, according to India's regulator.

"It's not like we put in any special marketing effort for this fund," said Kazuto Wada, an executive director at Nomura, Japan's largest brokerage. "Investors are looking at where the growth will be in the medium to long term, without having to worry about short-term swings in the market."

India's economy is expanding at about seven times the pace of Japan's, buoyed by a burgeoning middle class and more one than million young people joining the labor force every month. Indian shares have hit multiple records this year amid optimism about Prime Minister Narendra Modi's policies.

"You have an economy that's growing at 7 percent annually with reforms showing tangible progress," Wada said in an interview. "Growth in advanced economies is slowing."

India is what money managers have begun to call a "consensus trade," meaning almost every fund is bullish. Global and local funds have pumped about $16 billion into its stock market this year alone, making the Sensex one of the world's top performers in 2017 and sending the rupee up 5.6 percent against the dollar.

The combined assets of three India funds run by Nissay Asset Management Corp. have topped 100 billion yen since their launch 2015, said Sundeep Sikka, chief executive officer of Mumbai-based Reliance Nippon Life Asset Management Ltd. Nissay is a unit of Nippon Life

  • Input: IANS