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Contn. Ten Fund Managers Who Rock And Roll
DESIGNATION:
Head, Fund
Management, Zurich Asset Mgmt. India. Pentamedia, Global Telesystems, Silverline, and HFCL have never figured in the portfolio of the five equity funds Prashant Jain manages. And in early 2000, he did a Suria (yes, we know Ravi Suria is a debt market analyst and the comparison isn't therefore particularly apt) and brought down the exposure of all Zurich funds to the tech sector. In March, 2000, for instance, technology stocks accounted for just 15 per cent of Zurich India Prudence's portfolio; the rest was disbursed between the auto, consumer durable, construction, and FMCG (Fast Moving Consumer Goods) sectors. Not surprisingly, Zurich's funds weathered the tech meltdown fairly comfortably. ''We have a core list of 150 stocks, which is reviewed periodically to ensure portfolio quality,'' says Jain, ''and individual fund managers pick from this. These are companies with a good management team and sustainable business models.'' That, and the willingness to look for returns over the fairly long time horizon of 1-3 years-the preference for the scrips of Ashok Leyland, BHEL, and BPCL stands testimony to this-means that while none of Zurich's fund have been on fire, they haven't done badly either. P.S.: For those who came in late, Suria was the Lehman Brother's debt analyst who first suggested something could be wrong with Amazon.com RAJAT JAIN-EMERGING STAR
Any fund manager who uses the Porterian framework-developed by economist-turned management maven Michael Porter-to understand a company's competitiveness should be a shoo-in for a listing of this nature. Rajat Jain hopes to do that one day. Right now, the mechanical engineer who served as CIO and head of research of SBI Mutual Fund before moving to IDBI Principal last year, makes do with data. And feedback from his army of analysts who meet with companies, and their suppliers, customers, and distributors. The approach hasn't been unsuccessful. He picked Asian Paints and Corporation Bank when the scrips weren't what you could call fashionable. If Jain's approach indicates a deep-seated suspicion of undervalued stocks, there's a reason for it: he once picked one such, only to see its price nosedive further on the back of a weak management. ''Even if a scrip is available cheap, you should look at the quality of the company's management.'' For those investors seeking predictable returns, Jain may well be the fund manager to watch. ANUP MAHESHWARI-EMERGING STAR
Here's a simple formula to help you pick the right price at which a stock can be bought: earnings per share divided by the book value of a share gives the return on equity or the price one can pay for a stock. Not convinced? This is the equation Anup Maheshwari swears by. At 30, Maheshwari is perhaps the youngest fund manager in India. He's been fund manager for three DSP funds for just around three months, but has already evolved his own investing mantra: focus on fundamentals, but only after putting controls in place to prevent the analyst from getting enamoured with one sector or scrip. The new found prudence may be a result of Maheshwari's experience with tech stocks when he was managing DSP ML's offshore funds. He admits that he did not anticipate such a huge correction in tech stocks between March and September 2000. Like many others, Maheshwari, an MBA from IIM Lucknow, failed to see the imminent correction in the sector. But that is in the past; today, his bets are on large (market) capitalisation, old economy companies like L&T, Grasim, and Gujarat Ambuja. ''Lower interest rates and improvements in working capital management have helped these companies post good results, and they are still undervalued.'' We agree. SURESH SONI-EMERGING STAR
What's the manager of a bond fund doing in a listing dominated by his peers who manage equity funds? Well, Suresh Soni has successfully managed to increase the maturity period of the bonds in the portfolio of KP Income Builder to between 4 and 4.5 years, up from 2.3 years in July 2000. ''We brought down maturities when the market was bad, and we were not so sure how things would turn out, but the moment we were sure, we increased maturities,'' says Soni, making a fairly complex process sound relatively easy. To cut to the chase, Soni is a star on the debt-fund firmament. Kothari Pioneer poached him from Sundaram Newton where he managed the best-performing Sundaram Newton Bond Fund. Not an aggressive risk taker, his investing strategy is driven by his reading on the direction interest rates will take. Soni is an active debt fund manager who churns his portfolio far more often than some of his peers managing other debt funds. While picking investments, he doesn't follow ratings issued by credit rating agencies blindly. For instance, the managers of several bond funds picked the Maruti Udyog and the M&M bonds on the strength of their AAA ratings. Soni didn't; today, M&M has been downgraded to a AA+, and both bonds are trading lower, and his reputation as a star debt fund manager remains intact.
NILESH SHAH
He identifies himself with the proverbial -dare we say hackneyed-turtle that won out through sheer industry, and the fortuitous stroke of having to compete with a sleepy hare. Numbers show that the Templeton India Income Fund figures among the top five funds in the country over a three year period. That's certainly an achievement of some magnitude for fund manager Nilesh Shah (the second of our bond fund managers). Shah has been with Templeton India since 1997, and has striven to differentiate the Templeton Income fund from other debt funds. That's a tall task since most funds have similar portfolios and range of maturities. And managers of debt funds can optimise returns by either making the right call on interest rates or shuffling the portfolio to achieve the ideal risk-return balance. Says Shah: ''In the fixed income market we make money on a daily basis; we don't let a single day's interest rate on any security go.'' That explains why Shah is in with the birds everyday when the bond markets open. And that probably explains why his fund recorded a much lower loss compared to other debt funds last June when interest rates were volatile. 1 2 |
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PRASHANT JAIN
DESIGNATION:
Chief Investment Officer, IDBI-Principal Asset Management
DESIGNATION:
Fund Manager, DSP Merrill Lynch Investment Managers
DESIGNATION:
Fund
Manager, Kothari Pioneer Mutual Fund
DESIGNATION:
Chief Investment Officer, Templeton India Mutual Fund