Nilesh Shah, Chief Investment Officer, Templeton AMC talks about his favourite stock – Cipla. Cipla is also the top holding of Franklin India Growth Fund (FIGF). FIGF was launched in February 2000 at the peak of the technology bull-run. The fund took off with a sizeable allocation to technology stocks but currently holds a diversified portfolio. With the tech meltdown, it's down 40% since inception.
His favourite stock
My favourite stock in the past has been Cipla. It is a classical growth story with a reasonable valuation and several positives like very clean management, good dividend & bonus record and a very sound business model. The company moved to research in 70's and then forayed in the generic business. Further, there has been a total integration from bulk to formulation. Cipla currently caters to exports in a big way and there is newfound aggression in exports as demonstrated in the AIDS segment. Another plus is the company conservative management of cash.
Other stocks he likes
We like all our stocks, which are part of our portfolio and that's the reason they are there. We are hopeful for all but the highest confidence stems from companies like Hero Honda, Cipla, Britannia and Dr Reddy's.
On his bad investment and stocks he plans to weed out
As of today there are none. We are happy with the composition of our portfolio as of today. In the past, we have disinvested companies like Vikas WSP, for lack of corporate governance.