India Charted: Exploring the Massive Internet Investment Opportunity in India - Part III

Chart#1: Foreign Owners of Indian Equity Markets

Despite all the excitement about India and its long-term prospects, foreign ownership of Indian equities remains at a multi-year low. The market is largely being driven by domestic Indian institutions and investors. Meanwhile the average India allocation for U.S. investors in India is just 1% or less. U.S. and European investors have been missing out on the Indian growth opportunity for an extended period. We see this as room for growth.

Source: National Stock Exchange of India

Chart#2: Annualized Nominal GDP Growth vs Local Equity Index Returns since 2000

India is one of the few markets where GDP growth translates very well into public equity returns long term. Meanwhile, India is expected to be one of the fastest-growing economies over the next several decades. Interesting.

Source: J.P. Morgan Private Bank

Chart#3: Digital Transactions as of % of GDP - India

Here is a chart worth 1000 words. India's digital transactions increased from 4% of GDP in 2016 to over 76% in 2023, according to Morgan Stanley. Tremendous growth.

Source: Morgan Stanley

Chart #4: How Much Indians Spend Time Online

India is already leading the world in real-time digital payments, video hours spent online, and social media hours spent online. All driven by innovation and super low mobile data costs.

Source: Google India e-Conomy Report, 2023

Chart#5: Mobile Data Costs and Consumption in India

India has some of the world's lowest mobile data costs and highest mobile data consumption in the world. This is an excellent combination driving growth across the local digital and internet economies.

Source: EMQQ Global India Report

About the Author

Akeem Bailey is the Director of Research for EMQQ Global. Previously, Akeem worked at Rondure Global Advisors, where he helped oversee research and due diligence on emerging market equities and at Arisaig Partners, a Singapore-based hedge fund focused exclusively on consumer and internet companies in emerging markets. Akeem began his career living and working in India as a strategy consultant for the Mahindra Group. Akeem holds a B.A. in International Relations from the University of Pennsylvania.

Disclaimer

Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.