Rathbones head of multi-manager investments David Coombs has made his first allocation India as he feels the country stands to benefit from the energy revolution in the US.
Coombs made an initial allocation of 2 per cent in the £7m Rathbone Enhanced Growth fund by buying into the £492.3m JP Morgan Indian investment trust at a discount to its net asset value.
Coombs says: “I am trying to look for beneficiaries of changing trends. I thought of India because it is an economy that will benefit from lower energy costs – the UK would be another funnily enough.”
Mindful of the country’s setbacks, Coombs is optimistic of its long-term future and points to India’s large workforce demographics, good rule of law and stable economy for his reasoning.
Coombs says: “This is the first step to a longer term position. Hopefully after the election we will get a clearer idea of how the economy will develop.”
Chase de Vere head of communications Patrick Connolly agrees the energy revolution represents a longer term benefit and acknowledges the sentiment surrounding India.
Connolly says: “There is a lot of negative sentiment around India and as a result there have not been many buyers. The Indian economy has had a difficult time and there is a strong argument there is good value there.
“If you are using a multi-manager, you want a manager who is willing to go out and find value. It is positive for Coombs that he is willing to do that.”