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Nagara Gopal

Mr Vikaas M. Sachdeva (left), Country Head – Business Development, Bharti AXA Investment Managers Pvt Ltd, at the ‘Investors Meet’ organised by Business Line and PCS Securities Ltd at the KLN Prasad Auditorium in Hyderabad on Saturday. Also seen are Mr P.C. Shrimal (middle), Chairman of PCS Security, and Dr Ramana Vedulla, Dean of School of Management Studies, University of Hyderabad. —

Our Bureau

Hyderabad, Oct. 11

Domestic retail investments will be driving the mutual fund industry along with the product growth, according to Mr Vikaas M. Sachdeva, Country Head – Business Development, Bharti AXA Investment Managers Pvt Ltd.

Speaking at an Investor Meet organised by The Hindu Business Line in association with the broking house PCS Securities here on Saturday, Mr Sachdeva said the assets under management in the mutual fund industry was over Rs 7.5 lakh crore.

“There is still lot of scope for growth as MF assets under management as per centage of bank deposits is only 25 per cent,” he said.

Observing that the MF industry was growing at 29 per cent compounded annual growth for the last five years, Mr Sachdeva said MFs score over other instruments of investments due to various factors such as abolition of entry loads, restriction on exit loads and commissions.

“Investing in MF is now easier. Financial education will be growth driver. You lose money because you are not aware where it goes,” he said.

On the strategy to be adopted for high returns on investments, he said financial prudence was vital. “Balancing of portfolio is important. Asset allocation needs to be spread over conservative, moderate and aggressive modes,” he added.

If equity markets were expected to outperform in the short term, the investor might increase allocation in favour of equities for some time, he advised.

Stating that the market had witnessed lot of ‘adventurism’ last year, Mr P.C. Shrimal, Chairman, PCS Securities and past president of the Hyderabad Stock Exchange said that a series of reforms taken by the Government and regulators had given boost to trade in stocks.

Reforms such as online trading, separate client account, good margining system, trade guarantee fund were very helpful.

“Even dematerialisation eliminated the risk of bad delivery. All these improve the investor confidence,” he observed.

On the aspect of high volatility in markets, Mr Shrimal said: “Volatility is a problem but we have very little to check on it.”

Even in cases of high earnings per share/dividends, if a share was not receiving proper attention, it was due to poor corporate governance, he said.

Citing, the Rs 7,136 crore Satyam fraud, he stressed the need for better management systems and correct pricing of shares.

Dr Venkata Ramana Vedulla, Dean, School of Management, University of Hyderabad the fundamentals of the promoters were being studied carefully by the investors.

On the potential for growth, he said the employee segment was witnessing a lot of money which could be channelised into proper investments.

On the current investment trends, Dr Vedulla said: “When stocks are down, heavy investments are happening in PF funds in short term which are giving 8 per cent interest. The middle income group is investing in gold, IPOs, stocks while high income group prefers real estate, commodities. Carbon credit trading is also an emerging area.”

Mr M. Somasekhar, Chief of Bureau, Business Line Hyderabad, said the meeting was organised in the background of investors’ concerns, especially in a volatile market, a slowdown in the Indian economy and recession in developed countries.

The Hindu Business Line was active in organising such events and conducted similar events on important areas such as budget earlier, he added.

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