Foreign brokerage firm Credit Suisse remains underweight on India. It finds India one of the four most expensive markets in the world, with the others being Indonesia, the Philippines and Malaysia. Credit Suisse examines the view that India has a very low PEG ratio (price-to-earnings as a ratio of earnings growth), therefore making its valuations attractive. The brokerage firm is unconvinced by this view, stating that earnings tend to be overestimated, and if it used the historical difference of actual versus estimates, then India’s PEG of 0.89 times would rise to 1.94 times.
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