Markets To Consolidate In Next 1-2 Quarters

What is your take on the current investment climate of the country?

The conditions for investment climate are improving with government providing clearances for projects and initiating programs like Make in India. The government is also providing impetus on investments in Railways and Defence Localisation program. One can expect order flows for capital goods companies to improve in the last quarter of FY 2015.

What is your outlook for the equity markets for this fiscal?

The markets have done quite well in last one year. The markets will consolidate in next 1-2 quarters.

What changes have you seen in the markets after the budget?

We haven’t seen any major impact of Budget changes on markets.

Which are the global cues that you are looking forward for?

The most critical variable for India is commodity prices. A softer commodity price situation will help the Inflation.

Tell us something about your fund and its structure? How has it benefited the investors?

The Reliance Tax Fund has been focused on Alpha Creation over 2-3 years. The fund’s allocation to high quality Multinationals (30 per cent) and Indian Manufacturing companies has paid off well in last 12 months. The focus of this fund would continue to have alpha creation over next 2-3 years. The exposure to BSE 100 is between 40-60 per cent.

Reliance Vision Fund is a Large Cap Oriented Diversified Fund with focus on having 75 per cent exposure to top 100 companies and rest outside top 100. The fund has outperformed the benchmark by 30 per cent in last one year. The composition of portfolio is number one or number two companies in 75 per cent of the portfolio.

Do you see the GDP of the country reviving any soon and what are the reasons that you attribute for the same?

A meaningful GDP growth rate would be visible in 2-3 quarters as industrial recovery gains momentum.

What is your take on the present valuations of the India markets?

Valuations are attractive from a 2-3 year perspective.

What are the triggers that you are looking forward to with regard to the markets?

The most important trigger would be fall in inflation and reduction in interest rates. Also, pick up in industrial recovery and infrastructure investments is a key to revival in overall growth of economy.

What are the sectors that you are currently betting on, and in which areas should investors take caution?

Reliance Tax Saver and Reliance Vision Fund are betting on MNC companies and high quality companies in Indian Manufacturing Sector.

What advice would you like to give retail investors at this juncture?

Investors must not compromise the quality of management while making stock investments and take a 3-5 year call in order to get meaningful returns in case of Equity Mutual Funds.