Despite the turmoil around the world, both domestic and foreign money has continued to flow into the Indian market over the past few years. Retail investors have not shown any indication of slowdown as well; they have regularly put in a part of their savings into mutual funds via SIP or systematic investment plan route. This pouring in of money has coincided with rapidly rising valuations as well as dearth of opportunities in some areas. Such an environment has proved to be quite testing for different fund managers, especially of those who manage popular mutual fund schemes.
A lot of fund managers have not just dived into the market enthusiasm and strayed away from their core principles of investment. Most of them have kept their focus on creating a strong portfolio made up of quality stocks capable of delivering good returns over a long time period.
Presented below is a list of 5 best fund managers in India.
These fund managers have not been excessively influenced by current market euphoria and invested in poor quality businesses that have had remarkable outperformance over the past few years. Instead, their investments have continued to be based on deep analysis thereby preventing them from going astray. During this period of abundant liquidity, the managers have deftly played around with their portfolios and will be able to efficiently manage the ups and downs of the future, eventually offering a great experience and good returns for their investors.
- R. Janakiraman
Janakiraman Rengaraju is a fund manager at Franklin Templeton Mutual Fund. The 45 year old has nearly 20 years of experience. He is a BE and holds a PGDM. The average AUM for Janakiraman over 5 years is almost INR 7,350 crores, while the five year asset weighted yield is nearly 26 percent.
Janakiraman heavily favors investment in quality stocks; this principle is almost opposite of the current market sentiment which has been indifferent to ‘quality businesses’ over the past few months. This fund manager firmly believes that the process of a bull market maturing is marked by excessive liquidity, which subsequently results in an unworthy re-rating of businesses with below average quality.
The temptation of keep a specific level of portfolio performance may cause fund managers to opt for below par shares. However, Janakiraman has kept his focus on ensuring that sub-par stocks are kept out of the funds managed by him. All his funds are typically made of companies that have healthy flow of cash, offer high yield on capital, and have reduced capital intensity. He has also opted for businesses that have gained from discretionary demand in the domestic markets.
The top three sectors that Janakiraman has invested in include financial services (22.8%), industrials (18.8%), and consumer cyclical (18.6%). The top three stocks that Janakiraman has invested in include Yes Bank, HDFC Bank, and Finolex Cables.
The Funds managed by Mr. R. Janakiraman are Franklin India Smaller Companies Fund, Franklin India Prima Fund, Franklin India Taxshield Fund, Franklin India Flexicap Fund and Franklin India Opportunities Fund
- Neelesh Surana
Neelesh Surana is a fund manager at Mirae Asset Global Investments. The 45 year old has nearly 20 years of experience. He is a BE and an MBA. The average AUM for Surana over 5 years is almost INR 2,300 crores, while the five year asset weighted yield is over 25 percent.
Surana has delivered outperformance on a remarkably consistent basis across two opposite mandates. This has resulted in him being revered as a shrewd stock selector. India Opportunities and Emerging Bluechip, two of the funds managed by him, have outperformed to the envy of peers right from the time of their launch. It may also be noted that both these funds are still regarded amongst those with the best risk-reward portfolios in their particular categories.
The excitement of the market with regards to mid caps did create a challenging situation for Surana towards management of Emerging Bluechip mid-cap fund. However, he was able to minimize risk by opting for large mid cap stocks. He has stated that even though he did not have to go deeper into the market-cap ladder for stocks for alpha generation, the current market conditions did require him to deliberate more in the existing shares. When lump sum influx was closed to the fund, it did prove to be a boon for Surana. He was subsequently able to better navigate the delicate terrain of mid caps. The sharp deviation across different sectors triggers the need for increased comprehension of individual industries and businesses and this the area where Surana has shown his great capacities as an excellent fund manager.
The top three sectors that Surana has invested in include financial services (28.3%), consumer cyclical (15.4%), and basic materials (14.6%). The top three stocks that Surana has invested in include ICICI Bank, HDFC Bank, and IndusInd Bank.
Funds managed by Mr. Vinit Sambre are Mirae India Opportunities Fund and Mirae Emerging Bluechip Fund.
- Vinit Sambre
Vinit Sambre is a fund manager at DSP Blackrock Mutual Fund. The 42 year old has more than 18 years of experience. He is a B.Com graduate and is a C.A. The average AUM for Sambre over 5 years is over INR 3,650 crores, while the five year asset weighted yield is over 28 percent.
Over the past few years Sambre has made smart choices while choosing stocks and has taken the correct positions in a timely fashion, thereby making good returns during the sharp bull run currently running in the mid and small caps space. The immense patience shown by Sambre when picking stocks, a regimen of high analysis, and the restraint to avoid low quality businesses while pursuing alpha has allowed his fund ‘DSP Black-Rock Micro Cap’ to have a great performance.
Sambre did have to change his tactics when the market conditions changed rapidly. The portfolio of the funds managed by him grew rapidly due to heavy influx of money, thereby leading to problems in building higher positions in similar shares triggered by liquidity limits. As opportunities began to disappear, he had to turn to somewhat bigger businesses. New influx of money into the fund was also stopped temporarily so as to be able to meet these challenging issues.
During this entire period, Sambre did not waver from his basic investment principles and stuck to them. He refrained from investing in low quality companies while continuously doing evaluations of the current stocks and their positions. The rate of healthy returns offered by the funds managed by Sambre has reduced of late, but his capability to move around the stocks in the funds’ portfolios during trying times should renew the faith of investors.
The top three sectors that Sambre has invested in include basic materials (26.7%), consumer cyclical (26.2%), and financial services (16.9%). The top three stocks that Sambre has invested in include SRF, Manappuram Finance, and Finolex Cables.
Funds managed by Mr. Vinit Sambre are DSP BR Small & Mid Cap Fund and DSP BR Micro Cap Fund
- Sohini Andani
Sohini Andani is a fund manager at SBI Mutual Fund. The 46 year old has more than 21 years of experience. She is a B.Com graduate and is a C.A. The average AUM for Andani over 5 years is more than INR 4,800 crores, while the five year asset weighted yield is over 22.50 percent.
Andani is known for her steady and reliable performance and has gained her credibility with able handling of two distinctive mandates, i.e., SBI Magnum Midcap and SBI Bluechip. Andani has openly acknowledged that the pace at which the market climbed was very surprising for her. She believes that the re-rating of valuations of different businesses occurred at such a rapid pace due to the sudden rise in liquidity, while the fact still remained that the business fundamentals did not develop sufficiently to justify such high ratings. She has been very reluctant to go for increased returns via payment of higher prices for overvalued stocks. This is what has led to underperformance of the funds managed by her as compared to the market performance.
Despite the underperformance, Andani remains undeterred and continues to avoid investing in specific pockets during the current bull run in the market as she knows that it would affect the near term yields of her funds. She continues to maintain her focus on assembling positions in existing portfolio as and when it is possible. Her stance has always been that it is only possible to gain from compounding by holding on to great stocks over longer time periods.
Additionally, an increased corpus fund and the current market situation have caused her to concentrate more on detail when choosing stocks. If any incorrect decisions are reversed now, then it would have a greater impact on the returns of the funds as compared to the past when the size of the funds was not as big.
The top three sectors that Andani has invested in include financial services (32.0%), basic materials (13.8%), and consumer cyclical (12.8%). The top three stocks that Andani has invested in include HDFC Bank, Larsen & Toubro, and State Bank of India.
The funds managed by Sohini Andani are SBI Magnum Mid Cap Fund, SBI Bluechip Fund and SBI Banking & Financial Services.
- Chirag Setalvad
Chirag Setalvad is a fund manager at HDFC Mutual Fund. The 43 year old has 20 years of experience. Her educational qualifications include B.Sc and MBA. The average AUM for Janakiraman over 5 years is more than INR 10,420 crores, while the five year asset weighted yield is nearly 24.7 percent.
He is well known in the mutual fund industry for his investment skills – a fact reflected in the performance of the HDFC Mid-cap scheme, which he has managed for close to ten years now.
If understanding the business of the company in which he invests is a top priority for Chirag, paying a reasonable price for it is also equally important for him. His keenness in studying the company’s business even before getting into its financials has led him early on to some quality stocks.
The top three sectors that Jain has invested in include consumer cyclical (25.4%), financial services (18.8%), and Industrials (17.2%). The top three stocks that Jain has invested in include Tube Industries of India, Voltas and Balkrishna Industries.
Funds managed by Chirag are HDFC Mid Cap Opportunities Fund, HDFC Balanced Fund, HDFC Small Cap Fund, HDFC long Term Advantage Fund and HDFC Multiple Yield Fund.