Mr. Rupesh Patel

Excerpts:

 Like most of emerging markets, Indian equity markets have delivered stellar returns in CY'17. Those returns came on the back of improving macro as reflected in lower current account deficit, benign outlook on inflation and interest rates and soft crude prices. Lot of those macro tail winds seem to be normalizing. Further, on the domestic front, lot of volatility is expected on account of important state elections over next few months. In such an environment, stock performances would be a function of earnings visibility. We continue to maintain our positive stance on construction companies, private sector banks and consumer facing businesses.

2. What is your investment space? Any stock specific traits which makes it part of your portfolio? What?

 In terms of our investment universe, we broadly focus on two sets of companies. First would be companies which can compound their earnings over a long period of time, are efficient users of capital, run by decent managements and have innate strengths in their business models. These form the core of our portfolio. Second set is of opportunities, which are more tactical in nature, exist in market due to stock specific/industry specific/market specific developments and makes sense to buy at certain price.

3. What kind of stocks you avoid, why?

In investing you never say never. However, I generally desist from investing in companies which, in the past have shown scant regard for minority share holders' interest and the ones which have a history of bad capital allocations.

4.  Have you made any changes in your funds after the Union Budget 2018-19? What and Why?

We keep evaluating opportunities based on the intrinsic values of the businesses and prices at which they are available in the market. Changes to portfolio are often done to capture a relatively better risk reward opportunity as compared to our existing holdings. Thus announcements in the budget have not led to any specific changes in the portfolio and our core portfolio holdings have continued to remain same.

5. What will be your advice to investors?

Equity is a volatile asset class and has delivered superior tax adjusted returns over longer periods. However, to benefit from the same, one has to remain invested through the volatile phases. Hence, investors should not get too much worried about events which may have near term impact. We believe, India offers a long term growth opportunity on account of its demographic profile, rising per capita incomes, increasing urbanization and shift from unorganized to organized players. Hence, equity market corrections can be considered as good opportunities by investors to increase their equity exposures.