What is your view about the recent Evergrande episode of China? Do we need to make any changes in our portfolio and will the market crash?
- Shubham Jain
I don't know whether the market will crash or not, and nobody can tell you this with reasonable confidence. On your query regarding whether you should be making any changes to your portfolio, I would say, it is not required. This is a very internal issue of China and I don't think it will snowball.
In fact, I think there is a lesson for China to take from India on how to fix it. Look at the Real Estate Regulation Act. We initiated it three to four years back and it is now beginning to show results. Likewise, Indian banks have started lending more carefully and they have been deleveraging. Indian banks have reduced their exposure to real estate and have become more careful about lending to real estate companies. As a result of which, there has been a virtual clean up of the real estate sector. So I don't think we need to worry about what has happened in China.