IGC’s NAV is up 28.8% since our last note was published on 23 March 2016 (its price is up 20.1%) yet, in recent weeks, its discount has widened to 20.4%. There is no good reason why the discount should be widening, in our view. India shines as a bright spot in a world beset by economic problems: GDP growth is running at 7.9%. The managers of India Capital Growth (IGC) believe, that whilst a series of sometimes painful but very necessary adjustments is ongoing, India’s economy is now on a more stable footing and earnings growth, to date the missing ingredient in the bull case for Indian
equities, is set to materialise. IGC, with its focus on small-cap and mid-cap stocks in India, is ideally placed to benefit. IGC is poised to expand its share capital by 50% as the August exercise date for its
subscription shares approaches.

Mid- and small-cap listed investments in India

Investment objective: to provide long-term capital appreciation by investing (directly or indirectly) in companies based in India. The investment policy permits the company to make investments in a range of Indian equity securities and Indian equity-linked securities. The company’s investments will predominantly be in listed mid- and small-cap Indian companies.