The fund house is sitting on 4-5 percent cash in its equity portfolio across five schemes.
The corporate earnings growth for FY21 (2020-21) is expected to be in the range of 23-25 percent, Krishna Sanghavi, Chief Investment Officer-Equity, Mahindra Mutual Fund told Moneycontrol.
The Union Budget 2020 could be the near-term trigger for the market, he said, adding, “If there is a change in personal taxes as widely expected then it will boost the market sentiment."
Apart from personal taxes, one also needs to be watchful of how the government manages fiscal and monetary policies, Sanghavi noted.
Sanghavi has over 24 years of work experience of which around 11 years have been in the mutual fund industry and around eight years in the life insurance industry.
He joined Mahindra Mutual Fund in October 2019. Prior to this, he had been associated with Canara Robeco MF, Kotak Mahindra MF and Aviva Life Insurance Company India as the Head of Equities.
Mahindra MF is sitting on 4-5 percent cash in its equity portfolio across five schemes.
Sanghavi is betting on financials, and outsourcing sectors including information technology and pharmaceutical for investments.
“Outsourcing is a broader theme, so we like IT and pharma. The other way of looking at outsourcing is when pricing happens in dollar terms it need not be exported. But as long as your products are priced in dollar terms it equals the benefit of outsourcing,” Sanghavi said.
Another sector that he finds a ‘good investment space’ is telecom, given the change in dynamics.
Sanghavi pointed out that telecom should be classified as consumer stock. “It is broadly a three-player industry and dynamics are in place. Indians are consuming products whether you call it voice or data, 10-12 GB per month per user is not small by any standards,” he added.
Most fund houses were underweight on the sector since last two-three years due to uncertainty on pricing power.Mahindra Mutual Fund entered the mutual fund industry in 2016. It is among the smaller asset management companies in the country and has assets under management of a little over Rs 5,000 crore as of the December quarter.
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