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Morningstar Mutual Fund Guide
Morningstar India - 09 May 2019



Aditya Birla Sun Life Medium Term

Investment Strategy


Portfolio Manager Maneesh Dangi heads the fixed income desk at Aditya BSL AMC and is also the Co-Chief Investment Officer at the fund house. He has extensive experience of over 15 years in research and fund management and has been with Aditya Birla Sun Life since January 2006. Dangi is an experienced portfolio manager and is ably supported by an experienced team of fund managers and analysts.

The fund’s focus lies in taking active credit bets. The team’s ability to evaluate credits and invest across credit buckets with a view to optimise returns is important, especially given that the fund invests a significant portion of its assets in sub AA+ rated papers. The strategy allocates a small portion of its assets to GSec’s. Hence a combination of duration bets and credit calls drives the fund’s strategy.

The process is very stringent, both on the Government Securities as well as the corporate bonds side. The fixed income team could take structural, cyclical, medium-term or short-term views. They track headline indicators and tend to follow a market-linked strategy as opposed to a pure macro based strategy. The issuer-selection process on the corporate bond side is extremely detailed and based on a well-defined set of processes. The team relies on their internal ratings and processes as opposed to external credit rating agencies. Analysts tend focus on the promoters, corporate governance, liquidity and risks among other. The fund is a solid option for investors looking to invest into a relatively higher yielding medium-duration fund.



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HDFC Tax Saver

Manager Biography And Fund


Vinay Kulkarni has more than 25 years of experience in research and investment management. He has been associated with HDFC AMC since November 2006.

Kulkarni plies a multi cap approach, investing roughly 70 per cent in large caps and the remaining in small or mid caps. Kulkarni has a quality bias when investing in stocks. He chooses companies with good corporate governance standards and strong business models that enjoy sustainable advantages in the form of barriers to entry, market share, low cost of production, technological edge, and capable management teams. Although he prefers companies with low leverage, he is not constrained by this criterion as long as he has adequate comfort with the valuations and the business model.

Vinay Kulkarni is benchmark agnostic when constructing the portfolio the fund’s sector weights often deviate significantly from those of its benchmark. That said, he aims to de-risk the portfolio by investing in uncorrelated sectors of the economy. Although Kulkarni has historically held a higher allocation to mid caps (in the range of 40 per cent) his portfolio has tilted in favor of large caps since 2014.

Kulkarni’s portfolio clearly bears out his investment process. His holdings tend to remain fairly consistent over long time periods and this is reflected in the fund’s low turnover ratio. Top ten holdings constitute around 60 per cent of the said portfolio.

Kulkarni’s sizeable high conviction bets can result in some underperformance over the short-term. Nevertheless, we believe that over longer time frames, his investment style and expertise will hold the fund in good stead.



Reliance Large Cap

Manager Biography And Fund Strategy


Shailesh Raj Bhan, has over 20 years of experience in Equity research and fund management. He joined Reliance AMC in 2003 and has been running funds since 2004. He took over the helm of this fund in August 2007

He prefers running funds in an unconstrained manner with a fundamentally-driven and research-oriented investment style. Bhan plies a growth at a reasonable price strategy. Typically he prefers companies with healthy or rising ROEs. He does not mind paying more for a stock if he believes it has sustainable advantages and good growth prospects. The fund is a predominantly large cap offering. However, its investment approach allows the manager to invest up to 20 per cent of assets in mid cap stocks. While the manager stays clear of investing in small caps, the allocation to mid cap stocks has hovered  within  the range of 10-20 per cent for a long time now.

Bhan prefers large cap companies or companies with large cap capabilities while investing. Hence, he scouts for companies which are established, have a track record or have dominance in their area. The companies qualifying this criterion are usually leaders in their respective sectors. The idea here is to contain risk in the portfolio. Currently 60-65 per cent of the portfolio is biased towards domestic growth recovery as Bhan believes that it is an important theme to capitalise on over the long haul.

Bhan’s approach of taking significant sector bets, may result in a divergent performance over the short-term, but his stock picking ability should hold the fund in good stead. over the long term.

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