Woody: Name the most optimistic sectors right now?
Mahesh: Capital goods, banking and media.
Neena: On what basis do you choose sectors and stocks?
Mahesh: We select sectors based on a top down approach looking at the economic cycles. Stock selection is based on fundamental bottom up approach looking at valuations.
Shiva: How do private equity investments fare?
Mahesh: Shiva, Private equity is meant for a slightly longer term. The returns over the period should be about 20% per annum.
Sheetal: Where do you see the market going and what approach of investments should one adopt in this market and in the coming future ?
Also See Graphic
I expect markets to be volatile in the near term with some downward bias. But I am positive in the medium term and expect the market to give 15-20% returns over one year. You should invest into the market at various levels in this volatile period.
Mahesh Patil, co-head (equity investments), Birla Sun Life Frontline
Vandy: Are funds with infrastructure theme a safe bet if I have a 10-year horizon?
Mahesh: Infrastructure theme is good in the long term.
Sheetal: Some of Birla’s thematic funds don’t seem to be doing well despite the market reaching 17,000 levels last year. What do you have to say?
Mahesh: Thematic funds have to be looked at in the context of the fund’s objective and the theme which is in favour at that point in time. It is possible that for a particular period that theme may be out of favour, which explains the fund’s relative underperformance vis-a-vis the market.