By Tom Aylott, Reporter, Trustnet, 15 August 2023:
Investors seeking exposure to growth opportunities in the fast-growing Indian market are likely to have been underwhelmed by JPMorgan Indian’s poor performance over the past decade, but it could be taking a significant turn for the better.
Returns were up 153.1% over the past 10 years, meaning investors would have been 87.7 percentage points better off by simply tracking the MSCI India benchmark index.
Nevertheless, MIGO Opportunities manager Nick Greenwood bought a position in the £612m trust earlier this year, saying that markets have severely underpriced it…
The current discount is disproportionately large and needs to be addressed urgently by the board, according to James Carthew, head of investment company research of QuotedData.
JPMorgan Indian will have a continuation vote at its AGM next year that will decide whether or not the trust continues running and there is “a serious chance that it will lose” if the discount does not lower significantly before then.
“The easiest fix would be for it to be much more aggressive on tackling its discount and, as the largest of the Indian funds, it can comfortably do this without becoming sub scale,” he explained.
“We’d like to see the board commit to defending a high single-digit discount of say 8%, as this would provide a decent uplift for shareholders today while giving comfort to investors that they can get in and out at sensible valuations.
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