You have always been a long-term India bull. We have corrected just a wee bit from the top. We are still at 25,000 on the Nifty. What are the targets you are looking at before the year ends?
Mark Mobius: Probably 50,000 or more, who knows? But not before the year-end, by next year.
Other than property and infrastructure, what are the spaces where you would continue to buy more and more on declines?
Mark Mobius: What you are going to see in India is the development of the chip industry. You are going to see a very rapid development of semiconductor production and that means all of the infrastructure and all of the support for the development and design of chips. So what we are going to see is many, many opportunities to buy these companies. These are basically software companies. They call them fabless companies. They do not have fabs, they do not have factories, but they design. And of course, these companies are going to be coming up in India more and more.
Last time when we had this conversation with you, you did mention that you are looking at the mining sector very closely. With what is happening in China, the way the metals counters have moved over the last few trading sessions, have you looked at them more closely and more deeply now, the mining sector?
Mark Mobius: Yes, mining is very, very interesting because commodity prices are moving up. Copper has jumped up and a number of other commodities are looking good besides oil, of course. Generally speaking, we are not too excited about companies that do the mining or drill the oil, but we are more interested in the companies that supply the equipment for these industries. In the case of mining, it would be heavy contracting equipment. In the case of oil, the oil servicing industries, these kinds of people, because their earnings tend to be more steady longer term.
If you had $100 to invest across asset classes and markets, how are you going to divide that?
Mark Mobius: Equities are always at the top, there is no question about that; 10% in gold, but all the rest in equities. From time to time, when we have cash, we put it into short-term fixed income, but that is not something that we would hold for longer term.
I want a country-wise division on how the 90% is going to be distributed across world market equities.
Mark Mobius: It would be at least 20-30% in India, 20-30% in Taiwan, maybe 10% in China, 10% in Korea, and then the rest scattered around Vietnam, Thailand, Indonesia, Malaysia, Turkey, and a little bit in Brazil.
How is it that the US has completely skipped your list?
Mark Mobius: Well, the US is there, but it is reflected in these countries. So, for example, there are a lot of stocks listed in the US that are actually Indian, Chinese, Malaysian, whatever stocks done in ADR form. Also, there are some stocks in the US that have an incredible exposure to emerging markets. So, there will be some of those in the portfolio.
You have always been a big bull in India. A Nifty target of about 50,000 till next year is what you have mentioned. What is your target for Sensex then?
Mark Mobius: Probably 100,000. I have made a prediction in the past, as you know, and we are not too far from that. So, you are going to probably see much more upside.