Stocks not expensive yet – Jhunjhunwala

By Pratish Narayanan and Janaki Krishnan – Reuters

Maverick investor Rakesh Jhunjhunwala believes bold reforms such as opening up the country’s insurance and pensions to foreigners will be critical to quell concerns about the market being pricey and sustain a stock market rally.

Expectations for economic reforms in India have gathered momentum after the ruling coalition was re-elected with more seats in parliament nearly two weeks ago.

“Insurance, pension reforms are going to be extremely important for the stock market because the kind of money we’ll get from that is unbelievable,” Jhunjhunwala, dubbed by the media as India’s Warren Buffett, told Reuters in an interview.

The main stock index, which has jumped 16 percent since the election victory, taking gains to three-quarters from a 2009 low in early March, could rise another 10 percent to 15,500 by the end of December, he said.

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