It’s not all too often that I come across a piece mentioning three of Investorazzi’s legendary investors. This morning, Bloomberg’s Chen Shiyin and Catherine Yang compared emerging markets veteran Mark Mobius’ outlook for China and India stocks to those of Marc Faber and Jim Rogers. Shiyin and Yang wrote:

Stocks in China and India offer “good bargains” after benchmark indexes in the nations declined more than any other major market this year, Templeton Asset Management Ltd.’s Mark Mobius said.

“We’ve been rearranging the portfolio based on valuations, which have come down pretty dramatically in places like India and China,” Mobius, who oversees about $47 billion of emerging market equities as executive chairman of Templeton, said in an interview from Toronto. “There’ve been big declines.”

The Bloomberg reporters noted that Mobius’ view is shared by legendary investor Jim Rogers:

Mobius joins investor Jim Rogers in favoring Chinese stocks after they plunged 46 percent this year. China and India, the two most populous nations, are the worst performers among the world’s 20 largest stock markets as soaring raw material prices and slowing economic growth weigh on profits. Last year, China’s main index surged 162 percent and India’s advanced 47 percent.

China’s CSI 300 Index is valued at 21 times reported earnings, near the lowest in more than two years, and down from a peak of 53 times in October 2007. In India, the Sensitive Index is trading at 14 times reported earnings, down from a high of 31 earlier this year. That compares to a multiple of about 22 times for the Standard & Poor’s 500 Index in the U.S.

However, Marc Faber of The Gloom Boom & Doom Report disagrees with their outlook for Chinese and Indian equities. From the Bloomberg piece:

The investor who advocated bailing out of U.S. stocks before 1987’s so-called Black Monday crash and correctly predicted last August the U.S. would enter a bear market, said on July 4 that investors betting on a rebound in China’s tumbling stocks are setting themselves up for more losses.

Who will win this clash of the titans?

Source:

“Mobius Sees ‘Good Bargains’ in China, India Stocks (Update2)”
Chen Shiyin, Catherine Yang
Bloomberg, July 22, 2008

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