Unveiling the Indian Economic Powerhouse: An Insight into Betashares India Quality ETF (ASX: IIND)

India, the world's most populous nation with over 1.4 billion citizens, possesses a booming economy ripe with growth opportunities. As the country invests heavily in infrastructure and cultivates a flourishing middle class, the allure of its economy for investors magnifies. In this piece, we delve into the Betashares India Quality ETF (ASX: IIND), a dynamic vehicle that offers a stake in the burgeoning Indian share market.

 

With rising disposable income comes increased expenditure on entertainment, travel, gadgets, financial services, and luxury goods. Despite a global economic slowdown, Deloitte forecasts a 6% to 6.5% growth in the Indian economy in FY23, with a mid-term growth rate hovering around 6.5%. This robust scenario lays the groundwork for prospective earnings growth for Indian businesses.

Australia's Department of Foreign Affairs and Trade (DFAT) anticipates the Indian economy to soar by 6% to 8% annually over the next two decades, spurred by productivity enhancements. This promising prognosis solidifies the appeal of the ASX-listed Betashares India Quality ETF.

India is poised to emerge as a significant manufacturing hub as businesses broaden their supply chains. For instance, Foxconn, Apple's principal supplier, intends to initiate iPhone production in the southern Indian state of Karnataka by April 2024.

DFAT emphasizes that a prospering India will demand a host of Australia's goods and services over the next 20 years, spanning sectors such as agriculture, education, skills training, and healthcare. In 2021, India stood as Australia's sixth-largest bilateral goods and services trading ally and its fourth-largest export market for goods and services.

 

The Betashares India Quality ETF mirrors the 30 topmost 'quality' Indian firms, gauged on a trifold ranking: high profitability, low leverage, and high earnings stability. The portfolio's top 10 companies encompass Tata Consultancy Services, Infosys, Hindustan Unilever, Kotak Mahindra Bank, Icici Bank, Housing Development Finance, Bharti Airtel, Reliance Industries, Dr Reddy's Laboratories, and Axis Bank.

Over the past decade, the index tracked by this fund has demonstrated robust performance, with an average annual return of 14%, surpassing the S&P/ASX 200 Index (ASX: XJO). Nevertheless, the ETF boasts a fairly modest dividend yield and an annual expense of 0.8%.

While the Betashares India Quality ETF might not steal the limelight as the top performer, the prospective growth of the Indian economy renders it an enticing investment avenue for those seeking exposure to this thriving market. The latent earnings of the ETF hold the potential to fuel shareholder returns for years ahead.

Please note that the information provided in this article is general in nature only. We have not take into consideration your unique circumstances and therefore you should consider whether any products discussed are right your individual needs. we strongly recommend seeking professional financial advise before acting on any information within this article. 

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Sournce: https://www.fool.com.au/2023/06/26/is-this-asx-etf-a-great-way-to-invest-in-the-indian-economy/