Prem Watsa, who helms the $84 billion Toronto-based investment large Fairfax, reiterated his dedication to India, hailing the nation’s financial prospects. Fairfax‘s funding plans for India are on observe regardless of macroeconomic headwinds, he stated.”India has obtained one huge benefit – two-thirds of the economy is consumer-oriented,” Fairfax Financial Holdings chairman Watsa informed ET. “Nations like China have taken a long time to get that, through infrastructure development and government spending and all of that… It might drop a little, half a percent here, or a percent there, but it brings a lot of stability to an economy.” Fairfax has invested $7 billion in India, he stated. “In next five years, we are looking at doubling that. We got a few projects already that we’re working on,” Watsa stated. However, for India to stay a beautiful funding vacation spot, continuity can be key, he stated. ‘Country on a roll’
During his current go to to India, Watsa met Prime Minister Narendra Modi within the final week of December. “I think it’s fair to say that in India Modi is trusted – they say 70-80% comfort factor with the population in terms of the surveys that they do,” Watsa stated. “Investors feel that with Modi there, we can trust that the economy will continue to do well, and that there will be business friendly policies and no taxes that are inappropriately put in and that kind of stuff.”

The nation is healthier positioned than others to counter any disruptions.

“India is on a roll… You might have some problems in the US… a slowdown… you might have problems in China, because they have a lot of debt and they have a huge real estate crisis there that they’re looking to stabilise,” Watsa stated. “India doesn’t have those excesses. Stock prices may be high. And India is where China was like 15 years ago or 20 years ago, so a long way to go in terms of economic development.”

Fairfax just lately elevated its stake in Bangalore International Airport Ltd (BIAL) to 64% by buying further shares from accomplice Siemens. Watsa pointed to this occasion as an indication of his dedication to investments in India.

He highlighted that journey had rebounded as was evident from the efficiency of Thomas Cook India, one of many Canadian investor’s portfolio firms. Thomas Cook India‘s inventory worth has doubled prior to now one 12 months.

BIAL’s annual capability has risen to 50 million passengers with the opening of Terminal 2 and it will likely be including extra, in response to him. The subsequent step can be to construct extra infrastructure round BIAL and bid for extra airports as the corporate has confirmed its competence on this area. He cited the 450-acre airport metropolis, which incorporates the Taj, absolutely owned by BIAL.

“We want to be able to manage, build and construct more airports in India because we have shown we can do it right,” Watsa stated. “So, with (BIAL CEO) Hari Marar, we are looking at more airports that we can build. We have to make a return. We cannot bid unreasonable prices or unreasonable rates.”

Apart from Thomas Cook and BIAL, different main Fairfax holdings embody CSB Bank, Quess Corp and GoDigit insurance coverage.

Watsa, who constructed his early repute as a price investor and inventory picker, sounded a warning about huge world tech shares. “Apple, Microsoft, Amazon, they are all selling at high PE ratios,” he stated. “For any of those companies to grow 10%, they would have to add $20 billion in revenue extra or $50 billion in revenue in the case of Amazon – those are big numbers. If history is any guide, these things have come down. After the dotcom bust between 2000 and 2003, the Nasdaq dropped 75%, Microsoft dropped that much because the PE ratio was too high. I’ve been in the stock market for 50 years. You can’t say when it will happen but nothing goes to the sky and these things change and so I see that happening.”