Hi
@RickmajiksNever certain around war, it disrupts current thinking and creates risks for all of GQG’s investments - ITC and Adani being the larger two in portfolio.
The first risk is what the rest of the world will do as a result of the war and how both sides will be impacted. In the Ukraine War, the world rallied against Russia and shut down all trade. GQG was impacted as its holdings in Russian assets dropped to zero very quickly.
How likely is it that the world will do the same to India and Pakistan? I believe there is a low chance of this occurring, trade during previous Kashmir Wars was not shut down for either countries.
The second risk is how it will impact the economy of India. Current forecast for growth is 6%. This is a good article on potential impact:
https://frontline.thehindu.com/columns/operation-sindoor-india-pakistan-tensions-2025-war-costs-inequality/article69548600.ece/amp/From my reading of this, growth will potentially drop at Adani Airports due to increased airfares in the short term.
This is another article arguing minimal economic impact to India:
https://www.reuters.com/world/india/indias-appeal-investors-dimmed-not-derailed-by-conflict-with-pakistan-2025-05-07/There is the potential for government resources to be reallocated from infrastructure projects. This is likely to be positive for Adani as it is a privatised owner of similar assets. Their investments are likely to be more profitable.
As always, anything is possible. India sees this war as similar to the terrorist attacks on Israelis, Pakistan sees this as an attack on its sovereignty. The war should go on for some time now.
(20min delay)