iShares MSCI India Small-Cap ETF [SMIN] Stock Forecast

India essentially became the office of the world as corporations became more comfortable with work being performed outside of the office. We see fewer opportunities in branded sneakers and more opportunities in basic consumables.

India is currently experiencing 3 strong growth catalysts that should drive GDP outperformance. Legacy investment issues like a weak Rupee and mixed relative competitiveness are slowly improving.

The iShares MSCI India Small-Cap ETF makes for a valid investment as it could appreciate by 19% despite recession risks in the developed world. My bullish stance is supported by strong GDP figures, infrastructure investments, reforms undertaken by the Indian government, and India's less correlation with global growth.

Good growth momentum, strong credit growth, and a supportive budget environment provide a positive backdrop, though the Reserve Bank of India (RBI) still has work to do to tame inflation. Export growth is running at only about -6.5%YoY, a much smaller decline than the 20% fall we see in economies such as Korea, Taiwan, and Singapore.

India has become an increasingly attractive location for multinationals across a wide range of industries. Latest data on key economic indicators continue to show strong momentum in many sectors of the economy.

With the Indian growth story intact, the iShares MSCI India Small-Cap ETF offers investors a vehicle for higher beta exposure. In the near term, the sector allocation skew should see the fund benefit from the capex increase outlined in the recent budget.

SMIN invests in small-cap Indian stocks. The fund has technically out-performed U.S. equities recently; however, perhaps a lot of this has been due to favorable cyclical positioning and international equity rotation.

India is now the fastest-growing major economy in the world, surpassing China for the first time in a generation, with close to 8% growth. India's combination of a pro-business, reform-minded government; solid corporate governance; and overall management quality stands out within the emerging markets universe.

The world economy may have fallen into conditions that were seen during the 1997 Asian Financial Crisis, but this time around Asian countries better-positioned financially.

These ETF areas won in the third quarter of 2022.