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JM Financial Mutual Fund: Fair-weather Friend

The industry has always adapted itself to changes and has always emerged stronger. This is a passing phase and will have no long term impact.

Its tough to swim against the tide and this fund house knows it. The darling of investors during the good times has become the devil despite the market fortunes reversing. “We will improve infrastructure and focus on investor education, fund performance and careful product planning,” says Bhanu Katoch, CEO, JM Financial Asset Management. With the market inching to old highs; JM's funds are nowhere near what it desires.

Disappointing AUM growth: This is a passing phase and will have no long term impact. The landscape of the financial sector in India is continuously evolving and which is leading all the market participants to restructure their strategies to bring sustainable benefits.

Regulatory changes: I am confident that the industry will achieve its long term growth targets without compromising on 'investor interest'.

State of the market: Although the market is trading close to its all time high, on valuation, it is at 16x P/E of FY12 earnings, which is in line with the historical multiples. This is in contrast with the January 2008 peak when the market was trading at a much higher P/E forward multiple of 21x.

My investing style: Identifying companies with a strong management, above average earnings growth prospects and having attractive valuations would be the criteria for investment.