Fund managers upbeat, expect more reforms

Last Updated: Sun, Oct 07, 2012 04:15 hrs

Riding high on the crest of the reforms wave, the markets crossed the 19,000-mark on the Sensex. However, profit taking was also seen at higher levels, following the expiry of September derivative contracts. Globally, too, sentiment was upbeat as investor risk aversion eased after the European Central Bank said it was ready to buy the bonds of troubled Euro zone countries.

All the fund managers remained active between September 21 and October 5.

Sr VP (Equity Research), Anand Rathi Financial Services
Prabhakar sold Rallis India, BASF India, Tata Coffee (partially), Grasim Industries, Tube Investments, Titan Industries and Cummins India (partially), with 10 per cent gains. There were no buys.

He believes holding 30-40 per cent in cash would be better, as profit booking might occur before the results season, providing better entry points. Also, considering the political situation is still fluid, he feels being defensive and taking money out of high-beta stocks would be best. He also expects more reform measures in the coming weeks. His top holdings include Tata Coffee, Sun Pharmaceuticals, Emami, Coromandel International and Pfizer. The net worth is Rs 10.53 lakh, up 5.3 per cent.

CMD, CNI Research
Ostwal chose Tata Steel, Century Textiles & Industries, Clariant Chemicals and Bombay Burmah Trading Corporation to be included in his portfolio. On the sell side, he took off Bombay Dyeing & Manufacturing and Aban Offshore, with a 9-11 per cent gain.

He says, "Keep booking profits, as large-caps' valuations are close to the peak. One should start investing in undervalued mid-cap stocks now. If the market corrects till 5,500, then it would be a good strategy to get in again. This, most probably, will be possible during the Q2 earnings season."

According to him, the real 'bull run' would start with measures such as a rate cut. This would help companies and the economy, beside helping to correct the fiscal deficit.

Tata Steel, BF Utilities, Century Textiles & Industries, Clariant Chemicals, Bombay Burmah Trading Corporation and Aban Offshore are his top picks. Ostwal's net worth is Rs 10.53 lakh, up 5.3 per cent.

Fund Manager, Centrum Wealth
Fernandes bought Nesco, MRF, Bharat Electronics and Siemens during the week. He sold United Breweries, CEAT and Coal India, with gains of 1-15 per cent. However, he booked a two per cent loss in Lupin.

He opines that further reform measures, a significant flow of foreign direct investment (FDI) in aviation & retailing and, hence, a steady appreciation of the rupee provide a lot of conviction for the continuation of the present bull run. A possible political realignment during the winter session of Parliament could help the government pass the various FDI bills, providing a further boost to the market and economy. BASF India, ITC, KA5V1BK2, Nesco and Bharat Electronics are his top five holdings. Fernandes' net worth is Rs 10.75 lakh, up 7.5 per cent.

Head, Technical Research, Angel Broking
Kulkarni was on a buying spree, with Reliance Industries, Prestige Estates Projects, Speciality Restaurants, CEAT, Tata Motors, Balrampur Chini Mills, Rolta India, Ranbaxy and Apollo Hospitals being added to his portfolio. He sold Bank of Baroda, Punjab National Bank, Lanco Infratech, Mahindra & Mahindra, Voltas, Aditya Birla Nuvo and V-Guard Industries during the upmove.

He believes that although we have seen some consolidation in the Nifty, the overall undertone is still positive and stock selection will be crucial over the next few sessions. His advice is to use corrections up to 5,500 on the Nifty to create long positions. He cautions that one should not totally neglect high-beta counters, as they provide the edge to outperform the overall broader indices.

With this, his top five holdings are Godrej Industries, Tata Motors, Rolta India, Prestige Estates and Balrampur Chini Mills. The net worth is Rs 11.45 lakh, up 14.6 per cent.

Fund Manager, Emkay Investment Managers
Shah added two pharma scrips, Divis Laboratories and Cipla, to his kitty. He says the markets are in a strong and positive momentum, driven by much-awaited policy action. If these announcements continue, there is a good chance that corporate earnings would upgrade significantly for the next two years. On stock- specifics, he recommends that buying into companies where cash flows are in place and valuations are reasonable. This one rule will protect investors in all eventualities. His top holdings include IDFC, Exide Industries, Cipla, Hathway Cable & Datacom and Divis Laboratories. The net worth is Rs 10.66 lakh, up 6.6 per cent.

Sr VP and co-head equities, Motilal Oswal AMC - PMS
Badshah picked Multi Commodity Exchange of India (MCX), Crompton Greaves, Shasun Pharmaceutical and Aban Offshore during the period. And, squared off Punjab National Bank, United Spirits and Colgate-Palmolive (India).

Staying invested is the best call in the current scenario, he considers. Though high-beta might be the flavour of the time, it is essential to have a decent balance between good quality defensives and beta stocks. On reforms, he believes the pace will get quicker. His top five holdings are HDFC, Crompton Greaves, OnMobile Global, Aban Offshore and MCX. The net worth is Rs 10.9 lakh, up nine per cent.

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