From coder to fund manager: Meet HSBC MF’s Cheenu Gupta who manages AUM of Rs 40,000 crore

Cheenu Gupta, Fund Manager-Equities at HSBC MF.

On the occasion of International Women’s Day, Moneycontrol Personal Finance showcases women fund managers who have broken barriers in the Rs 65 lakh crore, male-dominated Indian mutual fund industry.

Cheenu Gupta, Fund Manager-Equities at HSBC Mutual Fund manages or co-manages 11 schemes at HSBC Mutual Fund with total assets under management (AUM) of Rs 39,968 crore as of January end.

She is the primary fund manager of schemes like HSBC Midcap Fund (AUM of Rs 10,753 crore), HSBC Aggressive Hybrid Fund (Rs 5,282 crore) and HSBC Large & Mid Cap Fund (Rs 3,873 crore).

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Gupta, who grew up in the Mumbai suburb of Kalyan, is a qualified Information technology (IT) engineer. She also has a  Chartered Financial Analyst (US charter) certification and has completed her Master of Business Administration in finance from the SP Jain Institute of Management in Mumbai.

One key piece of financial advice that Gupta got from her parents, which she still follows, is to save first and then decide about spending. “Also managing expenses is all about prioritising,” she adds.

As part of the series, Moneycontrol highlights her experiences, insights and outlook for the Indian markets.

What were your aspirations while growing up?

I was fascinated by computers in school (we first got them for the first time in grade 6) – and wanted to be a software programmer – which I did become post my IT Engineering. I loved the analytical and problem-solving aspect of it.

During my MBA, I got introduced to the world of finance and simply loved it. Understanding and reading about businesses enthused me. During my final year I got closer to investments and luckily landed in the industry as a prize winner of an inter-college contest.

What attracted you to the asset management industry?

Opportunities to learn about several businesses and industries. Learning lessons from the past and trying to peek into the future. Being an enabler in wealth creation for people at large to help them fulfill their dreams is indeed inspiring.

Tell us about your career in the initial days

I had an interesting start to my career at UTI as one of the research analysts. We had very good mentors there who helped us understand the different aspects of analysing businesses and develop our own investment styles by running simulated sector funds. Overall it was an enriching experience.

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Was it tough to crack the asset management field which to an extent is dominated by men?

Initially, there were some barriers to enter the industry, especially when applying for placement from campus, some of us were not selected for interview on the grounds that  the MF’s in house team were all men and were reluctant to add new female recruits to the team. But later since I did land in the industry, things have been quite encouraging. The industry respects meritocracy and there has been no discrimination.

From the beginning of your career, cite one mistake that made you a better fund manager.

Being an investor in the market over the years makes one humble. Earlier in my career as a research analyst I was very attached or biased towards some well-performing companies within the sector I tracked. As a result, I could not give a sell call on one of these companies despite it facing several challenges post a tough acquisition. The learning was to have an unbiased approach towards companies in the portfolio with the ability to reverse calls when external or internal conditions change.

Coming to markets, do you believe, given the kind of correction we have seen in markets and valuations, only good days are ahead?

Over the last five years post-COVID, barring the last few months, markets had seen a sharp run-up across, and especially in midcap and smallcap companies. So, some time correction or price correction was overdue. With the sharp price correction in recent times, the worst times definitely seem behind (us). Good days may be ahead but can take some time considering the slowdown in GDP, fall in consumption demand and the delay in pick up of private sector capex. Based on recent government initiatives in the budget and RBI measures of monetary easing, there could be some rebound in these, which can then lead the market to better footing.

How much more correction will bring valuations to fair levels?

For most of the companies and sectors, the froth in valuations has gone away. Largecap valuations had been comfortable and continue to be so. For midcaps and smallcaps, with index correction upwards of 20 percent and 25 percent, valuations overall have become comfortable. There could be instances of companies or sectors where earnings could still see some downgrades based on internal issues or overall demand outlook, but those seem limited.

What do you think is the most important monitorable for the market right now?

The pick-up in domestic GDP growth and some stability in international policies seem to be the topmost monitorable for markets right now. This is followed by other parameters such as currency stability, pick up in consumption demand, revival of private sector and continuation of govt capex and FII flows.

Which are the sectoral pockets you are finding good right now in terms of the valuation? Any stocks or sectors that you picked up in the recent correction?

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The banking and NBFC sector has seen some issues with regard to the credit deposit gap, high rates for deposit accretion resulting in NIMs contraction, and asset quality concerns in some pockets like personal loans and NBFC lending being addressed. The RBI has also aided with an injection of liquidity in the system and curtailment of some measures to curb lending in pockets. Hence, these seem in a better position. With the recent government thrust to consumption in the latest budget, we expect the weak consumption demand to see some pickup benefiting companies in the discretionary consumption space. Hence, we have added weight to these sectors.

How should one play the smallcap and midcap theme in 2025?

Knowing that there has been sharp correction in these spaces one can definitely stay invested. Further investments can also be built up using the SIP approach. Over the longer term, one should have a balanced mix of small and midcap funds in the overall portfolio.

What changes have you made in your smallcap and midcap funds amid market correction?

We have stayed invested in companies and stocks where we believe the demand outlook is strong and the earnings delivery over time can help give good returns going ahead. At the same time, in places where there has been some weakening of external or internal conditions, we have reduced weight. We have used these volatile times to further build position in companies where our conviction is higher.

Mutual fund inflows have been strong even when the market is falling. How do you see this?

Over the year, domestic mutual fund investors have displayed good resilience by staying invested in market corrections and rather using these opportunities to build onto investments. Such maturity can truly help them to reap the long -term rewards of investing.

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If someone has Rs 10 lakh to invest right now? What should be the current asset allocation strategy?

I would invest in funds which can invest across market cap categories such as multicap or flexicap funds. The large and midcap fund category is interesting from a risk-reward perspective for longer term growth with good potential for alpha generation.

If you could give one piece of advice to retail investors today, what would it be?

Returns over longer periods are made by investing in downturns and staying invested through difficult times only to get better rewards later. While constructing your portfolios do not be biased towards one category of mutual funds. Have good diversification and portfolio mix depending on your financial needs and duly considering the risk reward framework.