Second Covid wave likely to peak in India in June, says CLSA

Global parallels predict that the second wave of coronavirus pandemic in India is likely to peak in June, said foreign brokerage CLSA.

The brokerage said parallels from second wave pattern in 12 countries indicated that India is likely to see a peak in mid June and if one excludes Maharashtra, the country will see a peak in June end. The seven day moving average of daily case addition during the second wave in these countries peaked when reported cumulative infections hit a median level of 2.5% of the population in the respective country.

“These parallels from other countries indicate the market may start seeing some positive signs on the Covid-19 front in the coming weeks,” said CLSA.

In Maharashtra which houses India’s financial capital Mumbai, the second wave is likely to peak in May, the brokerage said, adding that this should pave the way for some relaxation in lockdown rules in the state my mid-May to mid-June.

CLSA said this, along with a pick-up in vaccinations and comforting management commentary during the ongoing results season, should allay the worst investor fears about the second wave over the coming weeks.

“This is likely to be seen by the market as a glimmer of hope and a possible play book for the rest of India where the situation may appear to be under control by June,” said CLSA.

The brokerage said India will have around 9% of the population with antibodies by the end of May.