Question: Is there any chance you could provide some informed commentary on the upcoming India Fund float.

Answer (By Paul Rickard): Two pieces of advice re the India Fund:

a) Read the prospectus very carefully; and
b) On listing, the NTA will be $0.96 per share (you are paying $1.00 for something worth $0.96.) Of course, there is a free option as well.

My guess is that if you want to invest, you may be better off waiting until it lists on the ASX.

The Indian market has had a fantastic run up over the last two years. While it is a growth economy, it is not without its challenges – so invest in moderation.

Question 2: Where is the Macquarie Group headed or is it already overpriced and over rated? Should I consider it as a potential growth opportunity?

Answer 2 (By Paul Rickard): I much preferred Macquarie Bank when it was around $20 a few years back – so I am a little wary about it at around $80. In fact, it is up almost 40% this calendar year – starting at $58.29 and now $79.70. That said, the company is driving forward and it is a company that will benefit from a lower Australian dollar.

Macquarie’s FY15 result beat most of the brokers’ forecasts. While positive on the stock, the brokers in the main remain wary given the share price appreciation. According to FN Arena, sentiment is +0.4 (scale -1.0 is most negative to +1.0 most positive). The consensus target price is $81.56 (a small premium to the current price), with the stock trading at a FY16 multiple of 15.5.

You will note that Macquarie is a member stock of our growth portfolio. I don’t see any reason to sell – just not sure I want to buy more at this price. So bottom line, look to buy on a market dip.

Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regards to your circumstances.