No political bias in report on India: Goldman Sachs

Drawing flak over upgrading Indian equities on hopes of an electoral victory for Narendra Modi in the Lok Sabha elections, global investment banker Goldman Sachs on Friday said it stood by its report based on investor sentiments and that it does not have any political bias.

"Our Asia Pacific Portfolio Strategy report... contains no political bias nor any political opinion by Goldman Sachs or its analysts. It simply notes that investor sentiment is being influenced by party politics. We stand by that assertion and by our research," the bank said in a statement.

A recent report of the global investment banker which praised BJP's prime Ministerial candidate Narendra Modi and suggested victory for the BJP-led NDA in the forthcoming general elections, created a political storm with Commerce and Industry Minister Anand Sharma describing it as "most inappropriate and objectionable".

Goldman Sachs further said that as securities firm, its role included providing "objective, impartial and independent research that explains to investors the fundamental reasons driving market sentiment and direction, including relevant political factors".

The November 5 report of the Goldman Sachs said, "BJP-led National Democratic Alliance (NDA) could prevail in the next Parliamentary elections that are due by May 2014. Equity investors tend to view the BJP as business-friendly, and the BJP's prime ministerial candidate Narendra Modi as an agent of change."

Rebutting the report, Mr Sharma said, "We don't need these kinds of daily certification or assurances. We are a self-confident nation...what I feel that any agency (or) organisation should be focused on their job, particularly, when it comes to functional democracies."

"...we surely would not be entertaining prescriptive approaches or prescriptions from those who are totally disconnected...Do we tell other countries that what their voter should decide. Respect democracy and respect country."

Meanwhile, Goldman Sachs India chief executive Bunty Bohra said, "It was not his (author's) views of the political climate, but his views on how market was looking at...."

"Research is independent, and it is not like it's my view. It is the research department independently saying what's going to happen," he said on the report.

His comments came as Mr Sharma and Congress General Secretary Digvijay Singh trashed the report of the investment banker, saying they should confine themselves to what they claim to specialise in--economy-- and not dabble in political speculation.

Goldman Sachs in a recent report titled as "Modi-fying our view: raise India to Marketweight", had upgraded overall view on domestic equities to "market weight".

The brokerage house revised its end-2014 target for nifty to 6,900 points, which implies a 9 per cent upside from the current levels.

The report attributed the optimism to the opposition BJP-led alliance gaining ground in opinion polls in the last few months suggesting a higher probability of a BJP-led alliance forming the next government.

"He is not saying sky is the limit. He is reiterating different micro-macro factors being transmitted into pricing of index. That's pretty fair sense," Mr Bohra said.