'The market has re-rated and seems pretty optimistic'

After the announcement of the corporate tax cut and the brief rally that followed, the market seems to have again slipped into uncertainties. This is testing the patience of investors. We speak to R Srinivasan, who manages SBI Focused Equity Fund. The fund has assets of over Rs 5,700 crore as of September 2019. We ask him when he sees a recovery in the market, how long the era of corporate governance crises will go on for, and how diversified a stock investor should be, among other questions. In spite of the recent corporate tax cut, the markets don't seem to be too excited. What's keeping them depressed? When do you see a recovery? Well, I'd say the markets are pretty excited. It seemed like they were on their way down and they recovered smartly. Very smartly! Why do you say the markets are depressed? Rather, the economy is depressed. Earnings are depressed; and for quite some time now! The market, on the other hand, has re-rated and seems pretty optimistic about future prospects despite being let-down year after year. In this market, your fund is one of the top performers over one year. How did you achieve this? In the Focused Equity Fund, we run a bottom-up portfolio that targets absolute returns (in a long-only context!) and is largely benchmark-agnostic. Due to liquidity constraints and a dearth of conviction ideas, we've got biased towards quality and