Woods: Would introduction of the direct taxes code and goods and services tax (GST) in 2011 change your outlook or sector choice?
Subramaniam: It will not change our outlook or sector choice. But we will be conscious of the fact that the introduction of GST may help certain sectors reduce their cost of operations. The impact of these reductions will be factored in our assumptions and we could look at valuations before making our decision.
KEA: Are your sales picking up after you got listed? How has your experience been with the new platform?
Subramaniam: Our sales have definitely picked up in the last few months. In fact, in the last few months while the industry has seen outflows, we have seen decent inflows. The platform is still new and investors will take time to accept it.
Also See MF and Budget 2010 (Graphic)
Rupan: You just have 25 stocks in the fund. Why?
Fund analysis: Subramaniam. Kaushik Chakravorty / Mint
Subramaniam: We usually have around 25 to 40 stocks in our portfolio. Since the markets have run up in recent months, the fund manager had more reasons to sell and, therefore, the number of stocks are on the lower side.
Livemint: Any thoughts on how the auto sector is doing?
Subramaniam: In terms of sales numbers, the auto sector is doing quite well. While the long-term opportunity for automobile companies is bright, stock valuations in the auto sector are not inexpensive.
KEA: What about the Budget?
Subramaniam: The Budget is well balanced, and some measures are prudent. For example, the intention to keep the fiscal deficit under control.