How Roopali Prabhu reads people and balance sheets for her equity research picks

Roopali Prabhu

Note to readers: In this special three-part series, Moneycontrol profiles three women who are not only in control of their own finances but also help other women and families manage their money. Earlier, we profiled Priya Sunder and Kiran Telang. Today, meet Roopali Prabhu, Chief Investment Officer (Private Wealth Group) at JM Financial.

Coming from a banking family which only trusted fixed deposits, Roopali Prabhu dived head-first into the world of investing at the young age of 17 years when she joined a broking firm in 1994. The idea was to broaden her horizon. Today, Prabhu manages client portfolios of around 1,200-1,300 families.

During her career, she has worked at some of the marquee names such as HDFC Bank, ICICI Prudential Asset Management Company, Morgan Stanley Private Wealth Management and Franklin Templeton Investments.

Initiation into the markets

Prabhu is a graduate and did her CA foundation on the side but reckons that the best education she ever had was a summer job at a broking firm in Pune for two months, which ultimately extended to six years.

“When I started, I didn't know anything about equity markets. All I knew was how to spell the word ‘shares’. It was hard work. It was a small firm, with just four of us working there. I had a very good mentor in Khushru Kanga, who strongly dissuaded any speculative activity. He was very keen in investing based on fundamentals. That was my biggest influence,” she remembers.

According to the money manager, while her job came after the Harshad Mehta scam, a key learning she had was that valuations are important.

After spending six years at the brokerage firm, Prabhu realised that it was time to “fly out of the nest”, and she joined HDFC Bank (private banking) in the Pune branch.

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From HDFC Bank, she moved to Kothari Pioneer Mutual Fund, which was later acquired by Franklin Templeton India. At FT, she was dealing with banks, large institutional groups, public sector banks, and even IDBI, before it became a universal bank.

Then came a short stint with ICICI Prudential MF (Portfolio Management Service), where Prabhu for the first time moved from institutional to ‘Product and Communication’.

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After just a year there, she got an opportunity to work for Morgan Stanley Private Wealth, which was just entering India. “By then I had realised that if you want to do product research, possibly distribution is a better side of the table to do it, than the mutual fund side,” she said.

Prabhu believes that constant learning is one key driving factor for her in life.

The financial expert also tried her hand at entrepreneurship as she founded Srujan Financial Services LLP with Deepali Sen.

“That didn't really work out for me, unfortunately. So within a few months, I realized that I wanted to come back to corporate life, and then came Sanctum Wealth,” Prabhu said. Sanctum really reaffirmed much of what I had learnt.

Approach to wealth management

The expert shares that as somebody who does diligence, her primary role is to segregate skill from luck. As an asset allocator I now track macros a lot more. “Over the years my style of managing money has become more refined. I now appreciate how technical indicators can help investors, but I don't understand them at all. So, I just have to rely on people who have expertise and experience in that field. I have learned to integrate a little bit of technical indicators although I'm still rooted a lot in fundamentals,” she said.

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Responsibilities of a money manager

Prabhu believes that a money manager must deliver on the client’s investment objectives but by being mindful so as to see risk from the clients’ lens. This is not always easy, she believes.

“I have observed that people often impose their own risk appetite on investors. Even when wealth managers deliver good returns, they should reflect whether the risk taken to deliver this return was appropriate” she said.

At JM Financial, which she recently joined, Prabhu’s role is also to manage the products and solutions domain for Private Wealth group. “It is about creating house views, creating guides on asset allocations, managing and reviewing client portfolios to make sure that they are all aligned with the objectives that that were laid out. Also, making sure diligence standards for product selection are very strong without compromising breadth” she said.

At JM Financial private wealth group she is working with over a 1,100 families.

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Wealth means freedom and security for Prabhu and she believes that savings come naturally to women. “Women have moved from being financially dependent to securing themselves financially, now they should actively participate in wealth creation”.

After a long hard day, Prabhu likes to read and organize around the house, which she finds very de-stressing.