IFN Analysis 10/16/24DISCLOSURE: As of 10/16 I have no open positions in NYSE: IFN
I am not a licensed investment advisor and I am not a tax advisor, nothing in this article is to be taken as financial advice.
India Fund, Inc. (The)
India Fund, Inc. (The) is a non-diversified closed end fund focused on the Indian market. The fund is currently trading at a discount of 7.5% to the net asset value with a 9% dividend yield.
The fund holds a basket of Indian equities, primary large cap companies with stable track records. With the fund launched in 2003 it has since under performed the Nifty 50 index which has had a historic run in recent years. So why would an investor consider IFN?
First of all IFN is trading at a discount to NAV meaning you are essentially buying the basket of stocks at a discount. It is also my personal belief that the equities held in IFN are better but valuation and fundamentally from the holdings in the Nifty 50 index.
Macro:
India is one of the fastest growing countries in the world in terms of both population and economically. However with several major drawbacks including the massive trade deficit, lack of efficiency in government operations, and less developed architecture to some of the competitor emerging markets. That being said India is a country of smart, hard working people, and I believe their economic environment will continue to improve.
Tax Considerations:
IFN is a closed end fund, meaning that it may have special tax considerations for some investors. From the perspective of a USA based investor I choose to hold all closed end funds in a Roth IRA retirement account. Please consult with a tax advisor before making any decisions.
