ETMarkets Fund Manager Talk: Adequately exposed to capital goods stocks as govt capex positive: Alok Singh, BoI MF

How much AUM do you manage and can you quantify the performance of your top funds in 2022 vis-a-vis the benchmark?
We manage around Rs 3,500 crore of assets, and out of this, around Rs 2,500 crore is equity related and the balance is in debt and money market funds. Most of our funds are well managed and performed well.

Our flagship fund in ELSS, smallcap, aggressive hybrid are doing well, and in fact, from a 3-5 year time horizon, they were best performing in their respective category. We can simply say that few of our schemes have performed well in comparison to the benchmark.

What is the kind of cash level you are sitting at – are you putting aside more cash amid the volatility in the market?
We normally don’t increase cash as part of our investment strategy. We like to manage the volatility by rebalancing the portfolio as per the market conditions.

There are plenty of multi-cap funds available in the market today. Why should one look to invest in Bank of India’s Multi Cap fund? What are its unique features?
Multi-cap funds are required to invest 25% each in large cap, midcap and small cap, and the balance 25% can be invested in any of the market cap categories.

In our fund, we want to dynamically manage this 25%, because not all market cap behave in a similar manner. Therefore, while the base allocation of 25% in each market cap will provide stability to the fund, the 25% dynamic allocation will take advantage of relative volatility among the three market cap categories.
Which sectors within the mid- and small cap segments look attractive to you and have investment opportunities?
As the government and private capex is expected to increase, we think that capital goods and capex-related segments in the mid- and smallcap segments look attractive from the future growth prospective.

The latest AMFI data showed that SIP inflows continue to hit record highs. But do you see risks to this if equity market returns stagnate in the coming months?
The equity markets never move in a straight line. There will always be period of stagnation, downward movement and upward movement. In equity market, one has to remain invested for a long period of time to generate better returns.

The Budget has given greater impetus to capital spending. In view of this, which sectors are you extremely bullish on and would look at increasing your exposure?
The high capital expenditure by the government supports our positive view on capital goods and materials space. In our portfolios, we are adequately exposed to these sectors.

What kind of asset allocation do you recommend investors if one assumes that India will be an underperforming market in the near term?
Considering India’s growth rate and the economy’s ability to sustain it over a long period of time, the allocation to equities may be high followed by fixed income. In equities also one can adequately allocate to largecap, midcap and smallcap, to have a stable equity portfolio.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)