Figure conscious Bala, as he is referred to by his colleagues, is one of the founder members of Birla Sun Life AMC. A mathematics graduate from Madras University, he holds a DFM degree from Mumbai University. He has more than 13 years of experience in the financial sector, majority of which was spent in the mutual funds industry. He has been head of equity and fixed income investments at Birla since inception. The returns of his funds are doing most of the talk about his figure consciousness.
Do you see a market crash in the near future?
During the recent run up of the market, post the US Fed cutting the Fed rate, we have seen the CNX MidCap under perform the larger indices. This has resulted in an increase in the valuations gap between large- and mid-caps. We analysed the results of all manufacturing companies in the BSE 500. We saw sales rise by 24 per cent while PAT grew by 70 per cent on year-on-year basis. Given the lower the inflation and a softer interest rate regime, we expect the coming quarters to go quite robust. This would widen the valuations gap between large- and mid-caps further. Hence we believe mid-caps would be very attractively valued.
What is the strategic and tactical orientation of your fund?
It is an open-ended growth scheme with the objective of achieving long-term growth of capital at controlled level of risk by primarily investing in mid-cap stocks.
Which are your top sector preferences?
We are excited about interest rate sensitive sectors and are betting on the industrial growth of country. Accordingly, we have large exposure to these sectors.
This interview appeared in the October 2007 issue of Mutual Fund Insight.