Chinese equities have outperformed India and other emerging market so far this year.The Shanghai Composite is up by about 33% year-to-date while Sensex is basically flat in dollar terms. Yesterday the Sensex fell 2.64% in the local market.
Based on the forward P/E ratio Indian stocks are expensive as they are trading above the 10-year average compared to Chinese stocks.
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Note: The data used in the above is as of March 23rd.
Source: Investment Strategy – Margin of Safety, March 2015, Societe Generale