THE ECONOMIC TIMES WHAT ARE

THE HIGH
RETURN
RATIO STOCKS
TO BET ON?
P8
www.etwealth.co | Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, New Delhi, Pune | August 1-7, 2022 | 24 pages | `8

WILL FIIs
COME BACK?
(And when?)
FIIs have withdrawn almost `4.4 lakh
crore from Indian equities in the past
16 months. Find out why they are
quitting and what can turn the tide.

The road What if How one

ahead for your boss should
investors keeps navigate
in HDFC asking you a global
funds for money recession
P4 P6 P11
 cover story
02 The Economic Times Wealth August 1-7, 2022

WILL FIIs
COME BACK?
(And when?)
FIIs have withdrawn
almost `4.4 lakh crore
from Indian equities
in the past 16 months.
Find out why they are
quitting and what can
reverse the trend.
PHOTOS: GETTY IMAGES

By Babar Zaidi other developed markets. A spike in bond FIIs are in withdrawal mode

T
yields drives away money from emerg-
he hot money that foreign ing markets like India into US bonds,” FIIs have withdrawn `4.38 lakh cr from Indian stocks in past 16 months
investors poured into Indian says Amit Gupta, Fund Manager, Adroit
markets has been flowing Financial Services. Bond yields in the FIIs net sales (` cr) Nifty -1,53,058
out at a rate never seen in US have risen from around 1.27% in July 17,616 -1,30,348
recent history. FIIs have sold 2021 to 3.3% in April 2022. The war in
a record `4.38 lakh crore worth of Indian Ukraine and the resultant surge in oil
17,280
stocks in the past 16 months (see graphic), prices only added fuel to the fire. 16,588 16,503
-1,00,968
averaging net sales of more than `1,300 Though FIIs have sold across the
crore on every trading day since 1 April board, financial sector stocks have
16,220
2021. The selling abated considerably in witnessed heavy selling. Five of the top 15,138
July but there are no conclusive signs of 10 stocks that saw the heaviest selling
a trend reversal yet. “The sustained sell- in the past five quarters are from the
ing has resulted in the FII stake in Nifty financial sector (see table). The IT sector
500 companies touching a multi-quarter also saw sustained sales by FIIs. Two IT -24,848
low of roughly 17%,” points out Hemang stocks figure in the list of biggest sell- -18,081
Jani, Head of Equity Strategy, Motilal offs by FIIs. “FIIs are selling bluechips
-7,614
Oswal Financial Services. to book the big gains they have made in
FIIs started withdrawing from Indian these stocks. It is rational to book profit Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul
markets last year after central banks during times of high uncertainty,” says 2021 2021 2021 2022 2022 2022
embarked on a policy of monetary tight- V.K. Vijayakumar, Chief Investment *Till 28 July
ening to rein in inflation. The aggres- Strategist at Geojit Financial Services.
sive rate hikes by central banks raised Enormous as they may appear, the FIIs have sold Selling has `58,122 crore Withdrawals
fears of a global recession, triggering an `4.38 lakh crore withdrawals by FIIs is `1,325 crore been across withdrawal slowed down
exodus of FIIs from emerging markets, just 5% of their total holdings in Indian worth of stocks the board, in June 2022 in July, with
including India. “The rise in inflation stocks. It is also noteworthy that the every trading but mostly was the high- just `7,614
globally led to a spike in interest rates bulk of the FII withdrawals (almost 63%) day from April in large-cap est in recent crore sales
and a jump in bond yields in the US and are accounted for by non-India dedi- 2021. bluechips. years. till now.
 cover story
The Economic Times Wealth August 1-7, 2022 03

cated funds. “FIIs don’t react to India

issues, but to global issues. They are Top 10 bluechips that FIIs sold FIIs stake up in these stocks
withdrawing from emerging markets FIIs have offloaded shares worth more than `2 lakh crore Though they have been net sellers, FIIs have
or from equities in general, not specifi- of these companies in the past 15 months. increased their holdings in these stocks.
cally from India,” points out Aashish P.
Sommaiyaa, CEO of White Oak Capital. FII % STAKE IN FII % STAKE IN VALUE OF
VALUE OF SOLD STAKE
COMPANY COMPANY
STAKE (` CR) BOUGHT
Retail investors fill the void MAR 2021 JUN 2022 MAR 2021 JUN 2022 (` CR)
The massive vacuum created by the
withdrawals of FIIs has been partially HDFC Bank 32.37 26.33 -46,736 Sun Pharma 11.67 14.95 6,883
filled by domestic institutional inves-
tors. They have purchased equities
Reliance Industries 24.93 23.19 -29,462 IRB Infra Developers 15.16 48.65 4,327
worth almost `3.68 lakh crore in the
past 16 months. A sizeable chunk of this
Tata Consultancy Services 15.62 13.5 -24,598 Tata Steel 18.56 21.95 3,875
came from mutual fund investors, who HDFC 72.78 67.75 -20,960 Voltas 14.38 24.67 3,411
have persisted with SIP investments.
According to AMFI, SIP investors put Adani Green Energy 21.47 15.91 -18,670 Cipla 23.23 27.49 3,344
an estimated `1.24 lakh crore in mutual
funds during 2021-22. “This has lent a HCL Technologies 24.14 17.91 -15,554 ONGC 8.08 9.97 3,148
huge support to Indian markets and
made them quite resilient as compared Bajaj Finance 24.06 19.98 -15,455 NTPC 11.94 14.00 2,974
to other global markets,” says Jani of
Motilal Oswal. Another big contribu- Kotak Mahindra Bank 44.23 40.55 -13,344 Hindustan Aeronautics 0.91 5.56 2,905
tion was from the Employees’ Provident
Fund, which allocates roughly `2,700 Adani Enterprises 20.51 15.83 -13,333 Bharat Electronics 11.58 15.99 2,867
crore, or 15% of its total monthly in-
flows, to stocks every month. Axis Bank 50.16 45.55 -10,350 Power Grid Corp 28.39 30.25 2724
The worrisome part is the estimated
`70,000 crore that retail investors have
TOTAL -2,08,461 TOTAL 36,459
poured into direct stock investments in *Value of sold stake is based on current market cap and will differ depending on stock *Value of purchased stake is based on current market cap and will differ depend-
the past 15 months. Many of these stocks prices on days of transactions. ing on stock prices on days of transactions.
do not have very sound fundamentals,
but retail investors have been made to
believe that these scrips are multibag-
gers in the making. Zomato is a prime
Small investors getting bolder IPOs have led to losses
example of investors being taken for a FIIs and DIIs reduced their stake in these companies, Small investors were made to believe that they
ride. The IPO issue price was `76, but the while holdings of small investors increased. could make big money by investing in these stocks.
stock listed at a fabulous premium, and
went on to hit a high of `169. That’s when SMALL INVESTORS INVESTMENTS LOSS
% STAKE IN BY SMALL IPO ISSUE CURRENT FOR IPO
smart money cashed out, and small STOCK INVESTORS STOCK
PRICE (`) PRICE (`) INVESTOR
investors started moving in. The stock MARCH JUNE SINCE MARCH (%)
2021 2022 2021 (` CR)
is now languishing at `46, down almost
72% from its peak. There are several oth- Indiabulls Housing 17.33 38.31 994 Suryoday Small Fin Bank 305 92.2 -69.8
er horror stories from the IPO market,
including Paytm and LIC, where inves- Happiest Minds Tech 18.8 28.37 1,403 One 97 Communications 2,150 722.2 -66.4
tors burnt their fingers (see table).
RBL Bank 12.92 24.91 660 CarTrade Tech 1,618 684.7 -57.7
What can bring FIIs back
Experts believe the return of FIIs will Jubilant Ingrevia 9.95 22.76 1,104 Fino Payments Bank 577 263.9 -54.3
depend largely on global inflation and
monetary tightening by central banks. KPIT Technologies 6.88 19.45 1,838 Windlas Biotech 460 217 -52.8
Oil prices have climbed down from their
highs and other commodity prices have Laxmi Organic Ind 5.51 16.09 909 PB Fintech 980 463.15 -52.7
also come down sharply. “How inflation
behaves going ahead and whether cen-
Dixon Technologies 12.06 15.5 787 AGS Transact Technologies 175 82.9 -52.6
tral banks slow down on aggressive rate
Zee Entertainment 5.28 10.01 1,071 Aditya Birla Sun Life AMC 712 426.9 -40.0
hikes would have a bearing on the FII
flows,” says Jani of Motilal Oswal. L&T Tech 5.65 8.61 1,069
Much will depend on the performance Shriram Properties 118 72.05 -38.9
of the US economy. “If the US economic Dr Lal Pathlabs 3.8 8.24 775
data suggests softening, it will reflect Life Insurance Corporation 949 679.95 -28.4
on the dollar exchange rate. It could TOTAL 10,609
also lead to review of the Fed stance and Data as on 29 Jul 2022 Source: ETIG database, Value Research
reversal in interest rates. All of these
or some of these occurrences can drive
FIIs back to emerging markets,” says erating, there is no indication of interest knee-jerk reactions from small investors. of quarters, but there are all indications
Sommaiyya of White Oak Capital. rate cuts. Last week, the US Fed raised Experts say wealth is created by invest- for financial stocks to do well. It is likely
The depreciation of the rupee is a criti- interest rates by 75 basis points. “Till ing and waiting with patience. They also that lending financials can lead the rally
cal factor. The rupee has depreciated by the Fed is hiking rates, the FII outflows say this could be a good time to enter the into the next phase of growth,” says Gupta
almost 7.5% in the past one year, which may continue though at a much reduced market. “Valuations have turned com- of Adroit Financial Services.
has dented the gains of foreign investors. pace,” cautions Gupta of Adroit Financial fortable at roughly 17.5 times the 1-year If you are still unsure of where to invest,
“FII outflows will reverse when either Services. Also, the rupee has clawed back forward earnings. Inflation also seems to take the mutual fund route and let the
of the following two conditions are met: after touching an all-time low of `80 per be peaking out with sharp corrections in fund manager figure that out for you.
one, the dollar and US bond yields stabi- dollar last week, but is still above `79. commodity prices, including crude,” says
lize, and two: the market corrects, by say Jani of Motilal Oswal.
10%, which will make valuations attrac- What should investors do But you need to be very choosy when it
tive,” says Vijayakumar of Geojit. While the FII withdrawals are certainly a comes to picking stocks. “The IT sector Please send your feedback to
etwealth@timesgroup.com
But while commodity prices are mod- matter of concern, they should not trigger growth is under a cloud for the next couple
 mutual funds
04 The Economic Times Wealth August 1-7, 2022

What lies ahead for investors

in HDFC AMC schemes?
Exit of a star fund manager should not be a reason to fret. Focus on the investing values instead.
by Sanket Dhanorkar
RINGING IN THE NEW

T
he longest serving fund manager Flagship funds earlier run by veteran fund manager
in the country’s mutual fund Prashant Jain will now be helmed by others.
industry finally bowed out last
week. HDFC AMC announced HDFC FLEXI CAP HDFC TOP 100
that Prashant Jain was stepping CURRENT AUM CURRENT AUM
M
down from his duties as CIO and fund man-
ager of its flagship schemes. This ushered in
`26,511 `19,910
a new dawn and a period of transition for the
fabled fund house. What does this mean for
its funds and existing investors?

Change of guard & approach
Jain’s unwavering conviction in his ideas
was his most storied trait. He wore it like a
badge of honour but at times it also became a
millstone around his neck. While he finally
left on a reasonably strong footing, some of
his big contrarian bets did not yield expected
payoffs for years on end. The approach asked
for zen-like patience from investors and ad-
visers alike. Yet, many continued to put faith
in his abilities. It was his reputation and ex-
perience that allowed him that freedom and
ability to dig in his heels. Experts feel this ex-
tent of goodwill will not pass onto the incom-
ing fund managers. Roopali Prabhu, CIO and
Co-Head of Products & Solutions, Sanctum
Wealth, says, “Jain showed a lot of mettle in
the face of pressure but the system always
backed him and made it possible for him to
do that. Anybody else who is not that senior
may not withstand similar pressures.” The
HDFC brand played its part in ring-fencing
the funds from mass exodus. If anybody else
underperformed for so long, investors would
have packed up and left. “The incoming fund
managers will have to be more mindful of
market realities,” says Amol Joshi, Founder,
PlanRupee Investment Services.
Anish Teli, Founder, QED Capital
Advisors, asserts, “It is good to have con-
viction. But even the biggest names in the
investing world have shown willingness to
adapt their styles depending on where the
winds are blowing. The clearest signal glob-
al markets have sent so far is that the process
is the star.” If investing strategies are not
realigned to reflect market realities, playing
catchup becomes difficult later. When exter-
nal dynamics are changing fast, it is critical
to continuously revisit and rework investing
thesis, says Vidya Bala, Head – Research,
Primeinvestor.in. Going forward, it is expect-
ed that the fund house will shift to a deeper
process-driven approach. “Now the size of
the funds has also grown a lot bigger and
cannot be run on individual whims. This
freedom will give way to stronger processes
and frameworks at the fund house,” reckons
Santosh Joseph, Founder and Managing
Partner, Germinate Investor Services. But
even as the fund house is expected to shed
some of its old ways, it is necessary that in-
NEW FUND MANAGER NEW FUND MANAGER
ROSHI JAIN RAHUL BAIJAL
Past experience Past experience
Franklin Templeton India Sundaram MF
Other schemes managed Other schemes managed
HDFC Focused 30, HDFC NA
Taxsaver.
HDFC BALANCED ADVANTAGE
(earlier HDFC Prudence)
CURRENT AUM
`43,079
tinct strengths. Agrawal is known
for his ability to read macros, Roshi
Jain for her value-centric approach
NEW FUND MANAGER and Baijal for his capabilities in the
large-cap space. The entire equity
GOPAL AGRAWAL (with
team will now be overseen by long-
SRINIVAS RAMAMURTHY serving fund manager Chirag Setalvad,
and ANIL BAMBOLI) who himself brings strong capabilities in
the mid- and small- cap segments and adopts
a refined blend of growth and value styles.
Past experience It is the clearest indication that the fund
Tata MF, DSP MF, Mirae Asset MF house has been laying the ground for more
Other schemes managed HDFC Capital style diversification in its suite of products.
Builder Value, HDFC Large & Mid Cap, Bala asserts, “HDFC AMC has realised the
HDFC Multi Cap, HDFC Dividend Yield need of the hour and it is evident in how
it has gone about hiring people.” Joseph
observes, “It has been a gradual, well calcu-
coming fund managers imbibe some values lated plan to remove overdependence on one
Jain practised, experts maintain. person and countered by adding specialists
across the investing spectrum.”
Ushering style diversity
In many ways, HDFC AMC has already Uncharted waters
set this transition in motion over the past Yet, this eclectic new look is not likely to be
few years. The change has not happened smooth sailing. Unlike earlier, the AMC’s
overnight. Under the stewardship of new funds are likely to take distinct paths. New
CEO Navneet Munot, the fund house has CIO Setalvad will let fund managers play
been roping in several new fund manag- to their individual strengths, industry
ers to bolster its investment team. Some insiders say. Many of the AMC’s funds have
of these are established names like Gopal already started on that path, recalibrating
Agrawal, Roshi Jain and Rahul Baijal. portfolios slowly based on the new man-
Responsibilities for Jain’s managed funds ager’s style. But this will take time and out-
will be farmed out to this set of fund manag- comes will vary. “Distinct strategies will
ers. Apart from boasting proven creden- help as long as it is clearly spelt out to the
tials, these fund managers also bring dis- investors. Otherwise it will get confusing,”
insists Bala. Meanwhile, in-
vestors should watch out for
some drift in style. “Cultural
integration is a gradual pro-
cess. There is bound to be some
style drift which can impact re-
turn,” argues Prabhu. It also remains
to be seen how Setalvad adapts to his
bigger leadership role without losing
focus on funds he manages.
What should investors do?
There is no reason for investors to
panic. “This is not the first time that
a star fund manager is handing over
the baton. AMCs have pulled off such
transitions in the past,” says Joshi.
Fund houses like DSP and Nippon
India also went through a period
of turmoil but new fund managers
have come in and done a good job.
“Investors can take comfort in know-
ing that the brand has thought this
through and the basic ingredients of
investing hygiene and competence
are in place,” insists Joseph. It is per-
haps time investors give more weight
to fully understand the underlying in-
vesting values rather than subscribe
to the cult of a star fund manager.
Please send your feedback to
etwealth@timesgroup.com
 financial planning
06 The Economic Times Wealth August 1-7, 2022

WEALTH
WHINES
My boss keeps asking
Money &
Relationships
me for money...
Here are the things to keep in mind while dealing with the situation
without impacting your job or career prospects, says Riju Mehta

M
aintaining a good relation-
ship with one’s boss can be
a tightrope walk at the best
of times. Add a personal fi-
nancial issue to the equation
and it can be difficult to keep your work
life on an even keel. For instance, what
should you do if your boss is in the habit of
borrowing money from colleagues, even
juniors or team members? Refusing to lend
might mean jeopardising your career in
the organisation and doing so could result
in financial loss if he or she does not return
the money. How should you handle the situ-
ation without impacting your job or work
relationship? Here are some things to keep
in mind the next time your boss asks you
for money.
Check his track record
1 The first time that your boss asks
for money, you may feel pressured to give
it without a thought. However, it may be a
ANIRBAN BORA
has contacted for the same. If it’s a genuine
financial crisis or emergency, it may be ok
to give the money, but make sure he knows
it’s a loan and the money needs to be re-
turned. If, on the other hand, it’s a frequent
practice, you should make an excuse and
refuse because you are unlikely to get the
money back.
Check your own finances
2 It is natural to feel intimidated when
your boss asks for money, but it is important
to keep tabs on your own financial situation
before giving in to pressure. If the amount
asked for is small, but the frequency of bor-
rowing is high, it may impact your own cash
flow and household budget, besides creating
problems with your spouse. So try to explain
your situation or make an excuse and refuse
to lend money.
Have an open discussion
3 Report to superviser
If your boss is a good person and you
his money management skills are poor,
leaving him short of cash every month.
Suggest the help of a financial planner
or advise behavioural counselling, if
possible. It is important to convey that
his habit is making everyone in the of-
fice uncomfortable and he needs to take
control of the situation.
Prepare to write off loan
4 If you are lending money to the
boss or even a colleague, give it with the
understanding that you are unlikely
to get the money back. So lend only the
amount that you are prepared to write
off and one that does not impact your
own finances. It will also help you avoid
any conflicts and heartburn over the
unpaid amount and you will be able to
maintain a more professional attitude
at work.
5

good idea to check with other colleagues if have an amiable relationship with him or
this is a habit and he regularly asks others her, try to have a frank and open discussion
for money, or you are the only person he about the issue. More so, if it’s a habit or
IF YOU HAVE A WEALTH WHINE, WRITE TO US... Disclaimer: The advice in this column is not from
a licensed healthcare professional and should
All of us have been in a financial dilemma when it comes to relationships. How do you say no to a friend not be construed as psychological counselling,
who wants you to invest in his new business venture? Should you take a loan from your married brother? therapy or medical advice. ET Wealth and the
Are you concerned about your wife’s impulse buying? If you have any such concerns that are hard to writer will not be responsible for the outcome of
resolve, write in to us at etwealth@timesgroup.com with ‘Wealth Whines’ as the subject. the suggestions made in the column.
If the boss is a frequent borrower
and you cannot afford to lend, but also
do not want to upset your relationship,
learn the art of saying no without of-
fending him. If it is a menace for the
entire team or several colleagues and is
affecting your work, report to his super-
viser as a team in order to resolve the
problem. Do not be the only one to report
it as you may have to face his ire if he
finds out about it.

READERS’ QUERIES

Q My parents died last year without a will. Will my father’s self-acquired house be
shared by both my brother and I, or will it be inherited only by my brother? — S. Sharma

According to the Hindu Succession (Amendment) Act 2005, a daughter has the same right to her father’s self-acquired property as the son, if the father passes
away without a will. Since both you and your brother are Class I legal heirs, the property will be shared equally between you and your sibling.

I am separated from my hus-
Q band and am in the process of
getting a divorce. Does the
jewellery gifted to me during our mar-
riage belong to me or will it be shared
by my husband?
— TK
All the gifts received by you during the
wedding will be considered streedhan
and belong to you. In fact, any asset,
including movable and immovable
property, received by you at any point in
time, during the wedding or childbirth,
will be deemed streedhan and you will
have the right to keep it. Your husband
or in-laws cannot stake a claim to these.
It is advisable that you identify all
such gifts and keep them in a safe place
where your husband or in-laws cannot
access these till the divorce proceed-
ings are complete.
I am 69 years old and have a
Q son and a daughter. My wife
passed away last year. I have
one property that I bought with my
own money and some ancestral prop-
erty as well. Is it possible to leave both
these properties only to my daughter
and not to my son? If yes, how can I en-
sure this?
— V.K. Singh
While you can pass on the self-acquired
property to whomsoever you want
through a valid will, the ancestral
property will go to your legal heirs by
virtue of their birth. You can write a
will specifying your daughter as the
sole beneficiary of your house, but re-
member to mention the reason why you
want to leave out your son in order to
reduce the chances of a dispute and con-
testing of the will by him. In case of the
ancestral property, you cannot give it to
anyone you want through a will and it
will be distributed equally among your
legal heirs.
I have been married for two
Q years and my husband has
been physically abusive to me
during this time. I and my husband
stay with my in-laws in their house,
but now my husband wants to sepa-
rate from me and throw me out of the
house. Can he do so?
— S. Agnihotri
According to a Supreme Court ruling
in 2020, a woman cannot be evicted
from her marital home that she shares
with her husband and in-laws. Even
if the house belongs to the in-laws and
not to the husband, or even if it is rent-
ed, you cannot legally be thrown out.
Hence, your husband cannot remove
you from this house if you do not want
to leave the place.
Disclaimer: The responses are based on limited
facts provided by the queries. It is advisable to
consult a legal practitioner after presenting full
facts and documents. Responses should not be con-
sidered as legal advice in any manner whatsoever.

product
launches
:: Insurance
ICICI Lombard has launched a slew of
motor insurance plans, including Motor
Floater insurance, Pay-As-You-Use and
Pay-How-You-Use, so that people with
multiple vehicles can be insured under
one policy with a single renewal date and
comprehensive cover, along with single
premium. Those opting for the Motor
Floater will be provided a lower premium
for multiple vehicles The full benefits of
no-claim at each vehicle level will be pre-
served under the Motor Floater offering
when one shifts from independent poli-
cies to the Motor Floater policy. In case of
no claims during policy period, a no-claim
bonus is offered on renewals as per the
applicable slab and up to 50%. Telematics
add-ons are offered to convert the base
product into an ‘asset-cum-usage’ prod-
uct. Under this, one can opt for plans
like Pay-As-You-Use (PAYU) and Pay-
How-You-Use (PHYU). In PAYU, one has
the flexibility to choose from different
‘Kilometers’ depending on usage and
premium would be limited to the extent
the vehicle is used or estimated to be
used. In PHYU, those with good driving
behaviour can avail of attractive dis-
counts over the base premium.
Companies go big on
hiring temporary staff
Manpower ramp up to cope with festive rush.
by Rica Bhattacharyya
A record high number of temp jobs is likely to
be created this festive season as companies
across industries are ramping up manpower
to cater to a post-pandemic rise in pent-up
demand and an anticipated increase in sea-
sonal purchase even as high inflation and
rising household expenses continue to weigh
on consumer sentiment.
According to data exclusively shared by
ManpowerGroup India, an all-time high
number of 500,000-550,000 new temp jobs will
be created between August and November.
The data is based on staffing demand from
companies across sectors like retail, e-com-
merce, logistics, warehousing, banking and
financial services, among others.
“Companies are in a rush to strengthen
manpower as they expect a big boost in their
sales both online and offline as this festive
season will be the first in the last three years
where most of the population is vaccinated,
Covid-induced restrictions are lifted, mobil-
review preview
The Economic Times Wealth August 1-7, 2022 07
Ola to fire around
1,000 employees
Ola is in the process of firing close to
1,000 employees even as it ramps up
hiring for electric mobility business.
ET reported earlier that the company
had started handing out pink slips
ity has improved and the fear of pandemic and had yet to formalise appraisals
has tapered down,” said Alok Kumar, sen- for many of its employees.
ior director for sales, account management
and global accounts at ManpowerGroup
India. This is an increase of around 20- 25%
jobs compared to last year’s festive months.
About 70% of the demand or 350,000 of
the new jobs are estimated to be in the
delivery, logistics and warehousing seg-
ment. The likes of Amazon, Shadowfax
Technologies, Ecom Express, and Flipkart
are all strengthening their last mile teams.
Shadowfax Technologies, which works
with online marketplaces, plans to hire
105,000 delivery agents in the next three
months, double its intake a year ago. Ecom
Express is planning to hire about 55,000
people for delivery roles and across its sort
centres before this festive season.
“Our hiring will be focused across
regions, and we see a huge uptake from
tier III/IV cities and remote parts of the
country,” said Ashish Sikka, chief strategy
officer, Ecom Express.
 stocks
08 The Economic Times Wealth August 1-7, 2022

High return
ratio stocks
to bet on
Companies that utilise their capital efficiently
can prove valuable investment bets due to
their ability to deliver above average returns.

by Sameer Bhardwaj tal structure consisting of both equity

C
apital plays a significant
role in business growth
and expansion. It helps in
procuring assets like plant,
machinery, tools and other
GETTYIMAGES
and debt), RoC proves useful as it meas-
ures the profit earned by a company rel-
ative to its total capital (equity and debt).
It is calculated by dividing the EBIT (a
measure of operating profit) by the capi-
tal employed. Companies that generate

heavy equipment. Like other factors
of production (land, labour, entrepre-
neur), the owners of the capital (or
investors) also expect a reasonable
return on their investments. Such own-
ers are both equity and debt investors.
To determine such returns, it is best
to analyse the return ratios, which help
investors determine the money a com-
pany is generating on the invested capi-
tal. The ratios indicate how efficiently
the management utilises the investors’
money in business operations.
The most commonly used return ra-
tios are return on equity (RoE), return
higher RoC have the ability to manage
and service debt in a very efficient way.
Also, RoC must be higher than the rate
at which the company borrows money
otherwise it indicates that the company
is not employing the capital efficiently.
The third return ratio, RoA, indicates
how efficiently a company coverts the
money used to purchase assets into net
profits. In other words, the ratio meas-
ures how profitable are the company’s APL APOLLO TUBES Return ratio 2021-22
assets. The ratio is useful for both inves- POTENTIAL
tors and the management. 12-month Current 1-year target UPSIDE RoE RoC RoA
ET Wealth analysed BSE500 compa-
nies to determine which ones have a
forward PE

29.2
price (`)

on capital (RoC) and return on assets
(RoA). These ratios are generally ex-
pressed in percentage terms. Higher
the return ratios better the valuations
of those companies and vice versa.
RoE measures how much a com-
pany earns on its equity capital. It is
calculated by dividing the annual net
income (or PAT) by the average equity
capital. For example, if RoE is 18%, it
implies that the company earned `18 on
every `100 worth of equity capital. An
increasing RoE over time means that
the company is generating shareholder
value by reinvesting its earnings in
quality projects that are contributing
to profits. On the other hand, a declin-
ing RoE over a period of time could
indicate reinvestment of capital in un-
productive assets.
However, RoE does not take into
account the other sources of financ-
ing like debt. A company with high
leverage or debt may show a high RoE
but the risks associated with high-
interest costs or debt servicing are not
reflected.
For levered companies (with a capi-
strong return ratio profile. Data for the
last 10 financial years for RoE, RoC and
RoA were extracted from Bloomberg
with 2021-22 as the latest year. we have
filtered out companies whose RoE, RoC,
and RoA in the year 2021-22 was the
highest in the last 10 years. Only compa-
nies with positive ratios in the defined
period were included.
There are only 23 such companies in
the BSE500 index. In the last 3, 5 and
10 years, these companies (as a group)
have delivered an average point-to-point
return of 252%, 251% and 1,799% respec-
tively. Comparatively, the BSE500 index
delivered 55.1%, 63.2%, and 251% point-
to-point returns during the same period.
All returns are absolute (not annual-
ized) and calculated as on 26 July 2022.
The wide outperformance shows that
the companies with high return ratios
are adequately rewarded by the markets
in the medium to long run.
Following are six companies out of
23 that have good analyst recommen-
dations and a decent one-year price
potential as per Bloomberg consensus
estimates.
905.9
price (`)
1,073.3
18.5% 28.2% 24.5% 14.2%
ANALYSTS’ RECOMMENDATIONS
THE COMPANY’S OPERATING perfor- BUY HOLD SELL
mance in the future will be supported
16 1 1
by the increasing share of value-added
products and strong demand from the down of premium (relative to secondary
infrastructure, construction, automobile pipes) will make the company’s products
and energy sectors. The demand for steel competitive.
pipes is expected to remain robust and the According to a report by Antique Stock
recent reduction in steel prices post the Broking, there will be a 32% volume
imposition of export duties bodes well for CAGR over 2022-23 and 2024-25 sup-
the company going forward. The company ported by value-added products from the
was losing market share to competitively ramp-up of the Raipur facility and lever-
priced secondary pipes. The fall in steel aging of Shankara’s distribution network.
prices will lead to a reduction in primary
pipe prices and the resultant narrowing
APL Apollo Tubes
111.93
100 BSE500
103.44
26 July 2021 26 July 2022
 stocks
The Economic Times Wealth August 1-7, 2022 09

BALAJI AMINES Return ratio 2021-22

POTENTIAL
12-month Current 1-year target UPSIDE ANALYSTS’ RECOMMENDATIONS
RoE RoC RoA
forward PE

22.2
price (`)

3,319.3
price (`)
4,677.3
40.9% 34.4% 35.7% 23.1%
BUY
5
HOLD
0
SELL
1
BSE500
103.44
100
THE COMPANY’S WIDESCALE operations According to a recent report from Way- Balaji Amines
across geographies will help it to capitalise 2Wealth, the company will report revenue 100.92
on rising domestic and international demand and PAT growth of 19% and EBITDA growth
for methylamine from the pharmaceutical of 17% in CAGR terms over the next two
and agrochemical industries. The company years. The growth will be driven by the com-
also enjoys the benefit of operating leverage missioning of the DMC plant, incremental
and an improved product mix. An increase volume from the de-bottlenecked DMF plant,
in contribution from better-margin products, ethyl amine capacity ramp-up, higher BSC
a strong capex pipeline and import substitu- plant utilization and new capex
tion opportunities are other strengths. completions. 26 July 2021 26 July 2022

KPR MILL COFORGE Return ratio 2021-22

POTENTIAL POTENTIAL
12-month Current 1-year target UPSIDE 12-month Current 1-year target UPSIDE ANALYSTS’ RECOMMENDATIONS
RoE RoC RoA
forward PE

20.9
price (`)

566.9
price (`)
775.7
36.8% forward PE

25.5
price (`)

3,743
price (`)
4,234.9
13.1% 25.5% 26.6% 15.6%
BUY
19
HOLD
4
SELL
4

Return ratio 2021-22 THE FUTURE PERFORMANCE will be support- BSE500

RoE RoC RoA ANALYSTS’ RECOMMENDATIONS ed by a strong order book and superior ex- 100 103.44
BUY HOLD SELL ecution capabilities. The demand environment
Coforge
30.4% 23.4% 20.7% remains strong and provides strong revenue
5 2 0 78.48
visibility for 2022-23. In the first quarter of
2022-23, the company added 12 clients and
THE COMPANY WILL benefit next two years. signed a $105 million BFS (banking financial
from the export opportuni- On the other hand, the services) deal for four years and a $20 mil-
ties in both garments and sugar segment growth is lion insurance deal for three years. Also, the
sugar segments and the gov- expected to accelerate with management has upgraded its revenue and
ernment support to these the commissioning of the margins guidance for 2022-23.
sectors. The commissioning ethanol plant. The new etha- According to a recent Dolat Capital report,
of the new garment facility nol capacity is expected to the company would continue to deliver strong
last year led to robust order be commissioned in 2022- revenue momentum over the next 2-4 quar-
book expansion. Also, a 23 and will enable the com- ters, which will sustain the current valuations. 26 July 2021 26 July 2022
recent FTA with Australia is pany to reap the benefits of
expected to benefit the com- rising demand for ethanol in
pany as the region accounts
for 13-15% of its sales. An
India. The Edelweiss report
forecast the sugar/ethanol
POWER GRID CORPORATION OF INDIA Return ratio
2021-22
Edelweiss report that was facility to deliver around 12-month Current 1-year target RoE RoC RoA
ANALYSTS’ RECOMMENDATIONS
released after the compa- 50% revenue CAGR over the forward PE price (`) price (`) POTENTIAL BUY HOLD SELL
UPSIDE
ny’s fourth-quarter results next two years. 23% 11.6% 6.6% 22 4 1
forecasts 13% growth in the
garment segment over the
KPR Mill
9.8 208 237
14%
150.82 THE COMPANY WILL benefit from
Power Grid Corporation
BSE500 emerging opportunities in tariff based
competitive bidding, Inter-state transmission, 119.81
100 103.44 100
grid strengthening, renewable linked projects and
storage. According to a JP Morgan report, capex
is a key driver for the company’s earnings and
multiples. Rising power demand, system strength- BSE500
ening and new segments can drive upgrades. The 103.44
company is likely to see improved payout ratios
with improvement in cash flows. Strong potential
for cash flow generation is driven by robust oper-
ating cash flows, which are estimated at `30,800
crore over 2020-21 and 2024-25. It estimates a
26 July 2021 26 July 2022 6% EPS CAGR over 2021-22 and 2024-25. 26 July 2021 26 July 2022

EXIDE INDUSTRIES Return ratio 2021-22 ANALYSTS’ RECOMMENDATIONS

POTENTIAL BSE500
12-month Current 1-year target UPSIDE BUY HOLD SELL
RoE RoC RoA 103.44
forward PE

13
price (`)

152
price (`)
191
26.1% 48.8% 46.4% 20.5%
100
18 5 1 Exide Industries
84.23
THE COMPANY WILL gain from auto OEM ing will be key growth catalysts. According
recovery and improvement in industrial to a JP Morgan report, the stronger balance
segment demand. The lead acid batteries sheet after the divestment of the life insur-
segment will continue to perform due to the ance business should help the company to
lack of charging infrastructure and power fund its capex commitment for a lithium cell
grid capabilities to handle electric vehicles. gigafactory through internal accruals. It is
Foray into EV battery space, cell and module well positioned to see steady core business 26 July 2021 26 July 2022
manufacturing, and Li-ion cell manufactur- growth for the next decade. Current price as on 26 July 2022. BSE Sensex 12M Forward PE: 19.47. Source: Bloomberg.
 family finance
10 The Economic Times Wealth August 1-7, 2022

Need to reduce
goal values G. SANTOSH & VEENA SANTOSH, 52 & 46 YEARS, SALARIED, CHENNAI

How to invest for goals

Due to lack of surplus and short time horizon,
G. Santosh may not be able to reach all goals. GOAL
FUTURE COST (`) /
TIME TO ACHIEVE
RESOURCES
USED
MONTHLY
INVESTMENT
NEEDED (`)

by Riju Mehta
Portfolio Emergency fund 2.18 lakh Cash -

G
. Santosh is a government em- CURRENT
ASSET Mutual funds,
ployee and lives with his wife, VALUE (`) 1st child’s education 24.2 lakh / 2 yrs -
real estate
a tutor, and two children, aged, Real Estate 60 lakh
19 and 14 years, in Chennai. Cash, mutual fund,
2nd child’s education 29.2 lakh / 4 yrs 39,819
They get a combined salary Cash 3.03 lakh real estate, stocks
of `72,000 a month, besides a pension of Debt
`22,500 as Santosh is a defence services re- 1st child’s wedding 37.5 lakh / 7 yrs Sukanya plan -
tiree. He also gets a rental income of `8,667 EPF 12.5 lakh
a month from a `42 lakh house, for which 2nd child’s wedding 60.7 lakh / 11 yrs - -
Insurance 9 lakh
he has taken a loan of `16.15 lakh and pays
an EMI of `30,000. He has another house Sukanya scheme 2.6 lakh Retirement 1.59 crore / 8 years EPF, PPF, NPS 12,000
worth `15 lakh and a `3 lakh plot of land.
His goals include building an emergency PPF 55,000
Investible surplus
corpus, saving for his children’s higher 52,819*
NPS 50,000 needed
education and weddings, and retirement.
According to Fincart, lack of investible Equity * Investment shown in table will start from next year after repayment of loan. For now, he can start investing
surplus, insufficient assets and a very `11,000 for child’s goal and `12,000 for retirement.
short time horizon means Santosh will Mutual fund 9.3 lakh Annual return assumed to be 12% for equity, 7% for debt funds. Inflation assumed to be 7%.
not be able to reach his goals if he does
not reduce the goal values. He should also Stocks 44,519
repay the home loan with his insurance
plan, which matures next year, and one of
Total 97.9 lakh Insurance portfolio
the mutual funds. This will free up `30,000.
For now, he can start by building an LIABILITIES CURRENT VALUE (`)
EXISTING SUGGESTED
EXISTING
emergency corpus of `2.18 lakh, which is MONTHLY MONTHLY
INSURANCE COVER SUGGESTIONS
equal to his three months’ expenses, by PREMIUM PREMIUM
Home loan 16.15 lakh (`)
(`) (`)
allocating a part of his cash. This amount
should be invested in a low duration fund. Total liabilities 16.15 lakh Life insurance
For his kids’ higher education, Santosh
will need `24.2 lakh and `29.2 lakh, in Net worth ` 81.8 lakh Term plan 1.04 crore 1,430 Continue 1,430
two and four years, respectively. For the
Traditional
former, he can allocate a part of his equity 5 lakh 3,451 Continue 3,451
plan
fund corpus and house worth `15 lakh. For
the latter, he can assign the plot of land, Cash flow Ulip - - - -
stocks, one mutual fund, and remaining
EXISTING SUGGESTED
cash. He will also have to start an SIP of (`) (`)
TOTAL 1.09 crore 4,881 - 4,881
`39,819 in debt funds from next year. For
children’s weddings in seven and 11 years, Income 1,03,167 1,03,167 Health insurance
he will need `37.5 lakh and `60.7 lakh,
but due to lack of surplus, he is advised to Outflow Employer’s - - - -
bring down these goal values. For retire-
Household 27,300 27,300
ment, he will need `1.59 crore in eight expenses Own 4 lakh 1,704 Continue 1,704
years. He can assign his EPF, PPF and NPS
corpus, and also start an SIP of `68,855 in Kids’ 14,000 14,000
education TOTAL 4 lakh 1,704 1,704
equity funds. He can start with `12,000 for
now and increase it with a rise in income. Contribution 1,500 1,500 Critical illness &
He will also continue to get pension for life. to parents accidental 24 lakh 169 Continue 169
For life insurance, Santosh has two Loan EMI 30,000 - disability
term plans of `1.04 crore, and a traditional
plan of `5 lakh. Though he needs a higher Insurance TOTAL 24 lakh 169 - 169
premium 6,754 6,754
cover, cash constraints mean he will not be
able to pay the premium. Since he only has
Insurance cost - 6,754 - 6,754
Investment 23,000 52,819
eight years to retire, Fincart suggests he Premiums are indicative and could vary for different insurers.
continue with the existing covers and not Total outflow 1,02,554 1,02,373
buy any more. For health, he has a `4 lakh
cover and `24 lakh accidental disability Surplus 613 794
plans for him and his wife. As his medical Write to us Looking for a professional to analyse your investment
portfolio? Write to us at etwealth@timesgroup.com with
expenses will be covered by government for expert ‘Family Finances’ as the subject. Our experts will study
your portfolio and offer objective advice on where and
even after retirement, he does not need
any more health cover.
Financial plan by FINCART
advice how much you need to invest to reach your goals.

Rules of surviving a recession
Secure earnings, avoid unnecessary investing risks and cut back on reckless spends, says Uma Shashikant.
R
ecession is in the air. Whether we
admit to it or not, signs of an eco-
nomic slowdown are around us.
We could argue that India will be
immune, or not. We could debate
whether the West will be more impacted than
the East. We might indulge in speculation
about the dollar and oil. But our circle of con-
trol is what needs action, not the larger circle
of concern that involves all these macro ques-
UMA SHASHIK ANT
IS CHAIRPER SON, tions.
CENTRE FOR INVES TMENT First, prepare for risks to your regular in-
EDUC ATION AND LE ARNING come. The degree of impact may vary depend-
ing on the sector you work in, the strength of
the firm you work for, the elasticity of demand
for your goods and services and many other
factors you don’t control or cannot realistically
estimate. But a drop in demand for products
and services can mean low or no increment,
cut in pay, cut in job role or loss of job in the
extreme.
Do not be reckless about changing your
job, or seeking new roles. Stay with the tested
Our job, our income,
waters when the going is tough. New jobs may
our debt, our assets,
be difficult to find. If you can supplement your
our expenses and
income with other moonlighting opportuni-
the well being of
ties, or part time work opportunities, pick
our household them up before job markets get into a deeper
are matters of our slump. Postpone decisions to quit or to take a
concern that need us break. Retain multiple earner status for the
to take action. household.
Second, do not fish in muddled waters and
try to make investment decisions you risk
considering as ‘smart’. This is not the time to
speculate on the dollar, oil or gold. You will
risk buying at the top and holding on through
a slump and make yourself no money. During
a recession, businesses do not make capital in-
vestment decisions. Nor should you. Do not buy
financial planning
GETTY IMAGES
real estate because someone told you that prop-
erty will never lose value. Be aware that many
assets are inflated in value when demand is
high and interest rates are low and will fall
steeply when those conditions reverse.
Third, business failure is a common occur-
rence in a recession. Weak businesses are at
higher risk, and new weaknesses will show up
as the situation gets worse. Do not speculate on
stocks and on unknown names. Keep off IPOs
and small-cap stocks and set aside the tempta-
tion to think of a new name as the next multi
bagger. Stick with the known and established
names that will likely remain standing during
tough times. Large-cap stocks and funds are
better avenues during tough times.
Fourth, do not start a new business yourself.
This is not the time to try entrepreneurship.
When interest rates are higher, and demand
for goods and services are lower, you will
struggle to establish and grow. Profit making
businesses come under stress during reces-
sionary times and resort to tactics to manage
unsold stocks and underutilised capacity. Go
back to the first point and secure your income.
Fifth, do not sell your stocks and property
in panic. Falling prices are not the right times
to sell. Timing the markets almost never pays
the common investor. Do not assume that you
have acquired good trading skills to time and
play economic cycles. Unless you are in finan-
cial distress do not liquidate your assets when
prices have fallen. Ride through after making
sure what you have is of good quality. Staying
invested with quality stocks and assets is your
insurance against permanent damage to your
wealth when economic cycles turn.
Sixth, do not acquire new debt. Put a brake
on borrowings. In an environment of low job
The Economic Times Wealth August 1-7, 2022 11
security, low demand for goods and ser-
vices and high interest rates, high house-
hold debt will become difficult to service.
Cut back on debt if you can and live within
your means. Even if you cannot save as well
as before, make sure you are not adding li-
abilities at the wrong time.
Seventh, if you are among the lucky
ones who have regular surpluses to invest,
choose debt over equity. Debt is your cush-
ion against fall in equity markets and an
income supplement during tough times. If
you stay with short term debt, you will also
enjoy the benefits of a rising interest rate
as Central banks tighten money and raise
interest rates. Overweight debt in your
monthly allocations of your savings.
Eighth, reduce expenses wherever
possible to keep the income adequate for
essentials even if there is a pay cut or job
loss. Cut back on discretionary spending
and be aware that these responses across
households will dampen demand for goods
and services even more. Cutting back is the
natural response of households to income
risks and to higher interest rates. Do not as-
sume you would be an exception.
Ninth, upgrade and update and prepare
for an expanded role for yourself. Recession
is the time to push all your assets to protect
your income and wealth from erosion. If
you invested in debt products and held back
from investing in equity, you must pay at-
tention to the human asset and invest in it
so any deterioration in value is checked.
Nothing is lost in a recession if you remain
alive and well and employable. The oppor-
tunity to start over always beckons.
Tenth, do not assume it is the end of the
world and make absolutely pessimistic de-
cisions. A recession is part of an economic
cycle and one has to ride through it until
it turns around. Resilience is built when
you face downturns and overconfidence
is tempered when assumptions go wrong.
There is a time to be conservative with the
job, income and investments and to go on
with life without too much speculation and
optimism. Focus on survival, the time to
rise and thrive will arrive soon after.
The ideas of circles of control and con-
cern are precious to think about. One can
spend a lot of time debating the macro level
events, focusing on the news headlines and
behaving as if the world’s well being is at
stake. The concerns about these high level
happenings seem important and valid to
many. But our circle of control is where our
actual task lies. Our job, our income, our
debt, our assets, our expenses and the well
being of our household are matters of our
concern that need us to take action. Focus
on those and you won’t miss much ignoring
the alarmist macro debates.
Please send your feedback to
etwealth@timesgroup.com
 financial planning
12 The Economic Times Wealth August 1-7, 2022
How to negate impact of
falling rupee on portfolio
Foreign investments can provide a buffer against rupee depreciation.
Ashish’s children will soon be
going abroad for undergradu-
ate studies. His son leaves next
year and his daughter is due to
join college in three years. He
is firm that both of them should
get a foreign education. He is
a senior management profes-
sional and earns well. He has
saved enough for his children
over the past 15 years. However,
the falling rupee has left him
worried. Banks are unable to
help him hedge the increasing
cost of fees and expenses he will
incur, if the rupee continues
to depreciate. How can Ashish
manage this risk and control
the adverse impact of the depre-
ciation on his corpus?
smart things to know
1
Balanced funds
and balanced
advantage
funds are
two types of
hybrid funds
that invest
in equity and
debt securities.
A
shish faces exchange rate risk
arising from the fact that his
earnings are in rupees and his
expenses towards his children’s
education will be in dollars. Any apprecia-
tion in the rupee will work in his favour,
while depreciation will increase the cost
of education. Ashish may not be able to
forecast the direction of the exchange rate
correctly, thanks to the global uncertain-
ty. He should, therefore, not try to specu-
late the value of the rupee. Currency de-
rivatives may turn out to be a risky choice
not suitable for his longer term horizon of
four to five years. Trying to time the mar-
kets might create problems if the rupee
appreciates. He has a clear need, therefore
hedging is a better alternative. He needs to
consider ways to earn dollar income from
rupee investments.
International investing might be a good
choice. He may like to look at investing in
dollar denominated bonds, ETFs and prod-
ucts. Foreign investments can provide a
potent buffer against rupee depreciation.
When the rupee slides against the cur-
Content on this page is courtesy Centre for Investment Education and Learning (CIEL).
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.
Balanced vs balanced advantage fund
2
Balanced funds have almost
Over the long
term, bal-
4Balanced funds are
3 5
equal allocation (minimum anced funds
40% and maximum 60%) to give more
both asset classes whereas stable returns
balanced advantage has no compared
fixed guideline and have the to balanced
flexibility to switch between advantage
both the asset classes. funds.
PAPER WORK
:: Registering complaints
under the NPS
The National Pension System
(NPS) is a pension-cum-investment
scheme of the government. NPS has
GETTY IMAGES
developed a multi-layered griev-
ance redressal system which helps
a subscriber register grievances
using any of the following ways:
Ways to register complaints
The subscriber can
register the complaint
on the complaint re-
dressal system available
online. Another way of registering a
complaint is by calling the NPS CRA
call centre. Alternatively, a written
complaint can be lodged.
Online complaint
The NPS subscriber
can register the
grievance against
any entity under NPS using their
login id and password. Another
rency of an international market where way is to visit the “Log Your
you have invested, you can get more ru- Grievance/Enquiry” section under
pees per unit of the currency invested and “Subscriber’s Corner” of the web-
the net asset value (NAV) rises. Similarly, site. On successful registration of
when the rupee ascends, the NAV decreas- the complaint, a token number is
es. For instance, an investment of $2,000 in generated for future reference.
a stock when 1 $= `80 would mean his cost
of investment in the native currency is
`1,60,000. In a scenario when the exchange Call centre or IVR system
rate increases to `90, Ashish’s investment The subscriber can
will be valued at `1,80,000. Thus, he would call the NSDL CRA call
have made a profit of `20,000 from merely centre at 1800 222
currency fluctuations. 080 and register their
Ashish may also like to look at interna- complaint. Here the
tional funds that invest in global markets. subscriber needs to authenticate
He should be careful not to choose risky using the T-pin. Once the complaint
is registered, a token number is
international investments. Some invest in
generated for future references.
a few countries or themes and may carry
equity and country risks. Some of these in-
ternational funds are global only in name
and may invest up to 65% in India to pro- Complaint using forms
vide tax benefits to their investors. Some The NPS subscriber can
funds have high costs and a very small also submit the griev-
size too. Ashish should choose with a focus ance in writing to the
POP–SP. Subscriber has
on his need to earn dollar income that will
to mention the PRAN as the means
help manage his currency risk.
of authentication. An acknowledge-
ment receipt is given after submis-
sion of form. Later, a token number
is emailed to the subscriber.
Subscriber can also get the token
number from the POP-SP against
the acknowledgement receipt.
The
expense
ratio of
:: Points to note
z Lodge complaint using the online
system so that the tracking of the
taxed as debt funds balanced
same can be done seamlessly.
whereas balanced ad- funds is
z If the complaint is not resolved to
vantage funds can be typically
the satisfaction of the subscriber,
taxed as equity or debt lower than
the complaint can be escalated.
depending upon the balanced
asset allocation at the advantage
time of redemption. funds.
SMART STATS
The Economic Times Wealth
August 1-7, 2022

In This Section
MUTUAL FUNDS - P14
LOANS AND DEPOSITS - P16

ET WEALTH TOP 50 STOCKS

ALTERNATIVE INVESTMENTS- P17

Every week we put about 3,000 stocks through four key filters and rate them on a mix of factors. The end result
of this is the listing of the top 50 stocks based on the composite rating to help ease your fortune hunt.

RANK PRICE ` GROWTH%* VA LUAT I O N R AT I O S RISK R AT I N G

Current Previous Stock Net Div Downside Bear No. of Consensus
Rank Rank Price Revenue Profit PE PB Yield PEG Risk Beta Analysts Rating

1 Fast growing stocks

Hindalco Industries 1 1 392.40 47.44 115.84 6.10 1.11 0.77 0.05 1.86 0.80 25 4.72
Oil India 2 3 186.60 23.28 41.82 3.59 0.66 5.75 0.15 2.32 0.33 20 4.45
NCC India 3 4 57.85 2.78 54.11 7.28 0.63 1.42 0.14 1.61 1.08 18 4.83 Top 5 stocks with the highest
revenue growth (%) over the
Larsen & Toubro 4 8 1,801.25 19.54 37.96 29.11 3.06 2.23 0.69 1.13 1.03 41 4.85
previous year
UPL 5 7 727.70 13.01 37.43 15.21 2.24 1.39 0.35 1.39 0.93 29 4.79
Hindalco 47
Mahanagar Gas 6 9 747.65 31.04 26.70 12.38 2.05 3.14 0.46 1.28 0.99 34 4.18 Industries
IndusInd Bank 7 5 1,017.70 15.61 41.71 14.53 1.59 0.51 0.33 1.72 1.61 49 4.76 Sagar Cements 46
Gujarat State Petronet 8 20 230.50 25.73 30.13 7.92 1.64 0.87 0.25 1.47 1.16 26 4.58 Eicher Motors 41
Quess Corp 9 11 568.80 28.41 86.11 34.98 3.47 1.44 0.40 1.80 1.33 13 4.61
Laurus Labs 41
Sagar Cements 10 6 176.25 45.52 51.84 30.22 1.66 0.79 0.66 1.84 0.90 12 4.58
Maruti Suzuki 40
Dr Reddy's Laboratories 11 15 4,260.05 11.78 51.40 29.79 3.67 0.70 0.59 1.03 0.56 43 4.70
India
Maruti Suzuki India 12 14 8,721.05 39.75 129.30 67.41 4.73 0.52 0.55 1.32 0.96 53 4.11
Balrampur Chini Mills 13 12 383.80 19.08 61.30 16.73 2.77 0.67 0.26 2.07 0.98 10 4.90
2 Least expensive stocks
Adani Ports & SEZ 14 13 764.50 28.65 76.45 34.02 4.22 0.66 0.45 1.54 1.52 25 4.60
Top 5 stocks with the lowest
Container Corp Of India 15 18 686.05 26.98 52.11 39.44 3.86 0.88 0.82 1.34 1.05 35 4.46 price-earnings ratio
Eicher Motors 16 19 3,054.00 41.20 70.74 49.90 6.64 0.56 0.71 1.24 0.67 47 4.13 Oil & Natural 3.57
Gas Corp
KEC International 17 16 471.50 20.18 67.07 35.60 3.27 0.87 0.53 1.49 0.89 28 4.32
Oil India 3.59
CESC 18 17 75.45 13.28 18.61 7.35 0.96 5.98 0.42 1.34 0.61 18 4.89
Manappuram
Bank of Baroda 19 22 117.15 0.91 24.20 7.79 0.67 2.41 0.32 1.85 1.36 35 4.57 5.99
Finance
Torrent Pharmaceuticals 20 23 1,502.80 16.32 100.46 65.34 8.53 1.61 0.64 1.41 0.51 32 4.38 Hindalco 6.10
Industries
Exide Industries 21 25 156.00 11.78 46.29 19.01 1.25 1.28 0.46 1.12 1.17 24 4.25
Coal India 7.22
NTPC 22 26 150.35 14.66 11.51 8.72 1.07 4.78 0.80 1.18 0.84 28 4.82
Reliance Industries 23 21 2,457.10 27.19 32.73 26.64 2.13 0.29 0.76 1.27 0.99 39 4.31
Oil & Natural Gas Corp 24 27 130.25 13.94 5.69 3.57 0.63 7.08 0.38 1.84 0.19 29 4.21 3 Best PEGs
Top 5 stocks with the least
EPL 25 30 170.55 15.03 37.86 25.04 2.94 2.51 0.64 1.43 1.02 14 4.43
price earnings to growth ratio
Cyient 26 24 795.35 31.89 16.20 16.54 2.77 3.04 1.05 1.35 0.56 20 4.30 Gujarat State
NCC India Petronet
Birla Corp 27 28 977.60 21.61 18.78 19.07 1.26 1.01 0.88 1.73 0.83 23 4.70
Zee Entertainment 28 29 248.05 11.21 45.58 23.89 2.12 1.04 0.58 2.02 1.50 23 4.52
0.05 0.14 0.15 0.25 0.26
Jyothy Labs 29 34 169.05 15.50 49.81 37.55 4.21 1.51 0.78 1.08 0.64 17 4.24
Mphasis 30 31 2,236.20 25.89 26.59 29.04 6.00 3.29 1.04 1.71 1.32 34 4.56
Coal India 31 33 202.85 18.02 10.56 7.22 2.91 8.60 0.66 1.59 0.81 27 4.26 Hindalco Oil India Balrampur
Industries Chini Mills
HG Infra Engineering 32 41 574.45 25.76 9.08 9.86 2.61 0.32 0.27 2.02 1.31 16 5.00
Indoco Remedies 33 38 382.40 19.68 36.96 22.63 3.87 0.39 0.61 1.56 0.71 10 4.70
4 Income generators
Endurance Technologies 34 36 1,433.60 23.54 48.64 43.63 5.13 0.42 0.89 1.54 0.78 24 4.50
Top 5 stocks with the highest
Alembic Pharmaceuticals 35 40 701.05 12.18 37.39 25.25 2.63 2.00 0.66 1.10 0.52 19 3.26 dividend yield (%)
Blue Star 36 -- 998.95 24.31 77.08 56.69 9.36 1.01 0.75 1.36 0.74 21 4.05 Coal India 8.60
Bajaj Auto 37 37 3,858.25 14.95 14.96 18.21 3.76 3.60 0.98 1.10 0.54 53 3.87 Oil & Natural
7.08
Gas Corp
ICICI Lombard Gen.Insur. 38 46 1,189.20 20.25 45.71 45.85 6.40 0.67 0.95 1.19 0.96 29 4.45 CESC 5.98
Symphony 39 35 955.90 33.63 69.71 55.67 7.95 0.74 0.77 1.25 0.85 10 4.40 Oil India 5.75
Glenmark Pharmaceutic. 40 43 380.05 20.55 22.19 11.33 1.17 0.66 0.51 1.37 0.88 20 3.80
NTPC 4.78
Bharat Electronics 41 47 272.35 22.82 22.77 27.73 5.42 1.54 1.22 1.42 1.13 30 4.63
Bharat Forge 42 45 730.75 14.26 40.95 30.73 5.06 0.98 0.76 1.53 1.25 32 4.22
5 Least risky
Manappuram Finance 43 -- 97.25 14.24 15.32 5.99 0.95 3.19 0.40 1.95 1.35 17 4.35 Top 5 stocks with the lowest
JB Chemicals & Pharma 44 44 1,733.55 26.00 28.19 34.71 6.27 0.95 1.02 1.20 0.62 11 4.73 downside risk
Varun Beverages 45 48 876.25 35.71 87.90 81.40 13.85 0.19 0.89 1.59 0.67 17 4.71 Alembic
Cipla India Pharmaceuticals
Laurus Labs 46 49 525.25 40.99 52.20 33.32 8.24 0.39 0.61 1.60 1.07 15 4.07
City Union Bank 47 -- 161.15 16.27 25.49 15.67 1.81 0.12 0.62 1.31 1.14 26 4.54
1.03 1.07 1.08 1.1 1.1
Cipla/India 48 -- 967.45 12.38 30.03 31.22 3.77 0.51 1.03 1.07 0.08 44 4.39
Birlasoft 49 -- 329.30 23.12 20.88 19.60 3.53 1.38 0.96 1.95 1.30 12 4.75
Dr Reddy's Jyothy Labs Bajaj Auto
Greenply Industries 50 -- 182.55 24.06 31.32 23.85 4.19 0.22 0.72 1.76 1.25 12 4.83 Laboratories
SEE DOWNSIDE RISK AND BEAR BETA COLUMNS
*REVENUE AND NET PROFIT GROWTH IS BASED ON CONSENSUS ANALYSTS' EXPECTATIONS. NR: NOT IN THE RANKING. DATA AS ON 28 JULY 2022. SOURCE: BLOOMBERG IN THE ADJACENT TABLE.
 smart stats
14 The Economic Times Wealth August 1-7, 2022

ETW FUNDS 100

BEST FUNDS TO BUILD YOUR PORTFOLIO
LAGGARDS & LEADERS
Taking a long-term view of fund returns, here is a list of 10
funds in each category—five leaders (worth investing) and
five laggards (that may be a drag on your portfolio).

LAGGARDS LEADERS

ET Wealth collaborates with Value Research to identify the top-performing Equity: Large-cap 5-year returns
funds across categories. Equity funds and equity-oriented hybrid funds are 6.17 16.21
ranked on 3-year returns while debt-oriented hybrid and income funds are JM Focused Fund Nippon India ETF Nifty 50 Value 20

ranked on 1-year returns. 6.62 16.02

Taurus Largecap Equity Fund Kotak Nifty 50 Value 20 ETF
7.03 15.95
RETURNS (%) DSP Top 100 Equity Fund ICICI Prudential Nifty50 Value 20 ETF
Value Research Net Assets Expense
Fund Rating (` Cr) 3-Month 6-Month 1-Year 3-Year 5-Year Ratio (%) 7.22 12.72
IDBI Nifty Junior Index Fund HDFC S&P BSE Sensex ETF
EQUITY: LARGE CAP 7.6 12.71
Canara Robeco Bluechip Equity Fund - Regular Plan
Kotak Bluechip Fund - Regular Plan


6,824.39
4,217.00
-1.49
-0.96
-4.38
-2.98
2.01
3.04
16.7
16.09
12.6
10.85
1.86
2
16.7% ICICI Prudential Nifty Next LIC MF S&P BSE Sensex ETF - Sensex

UTI Mastershare Fund - Regular Plan  9,237.78 -2.32 -4.81 3.83 15.57 10.99 2.09 THE 3-YEAR
RETURN OF
ICICI Prudential Bluechip Fund
UTI Nifty 50 Index Fund - Regular Plan


29,981.07
7,068.10
-1.32
-1.69
-2.64
-2.01
8.31
6.71
15.27
14.74
11.02
11.68
1.71
0.31
CANARA
ROBECO
Equity: Flexi-cap 5-year returns
IDFC Nifty 50 Index Fund - Regular Plan  424.17 -1.62 -1.88 6.66 14.73 11.63 0.46 BLUECHIP IS
ICICI Prudential S&P BSE Sensex Index Fund  561.72 -1.11 -1.91 6.97 14.63 — 0.29 THE HIGHEST 4.53 16.57
Baroda BNP Paribas Large Cap Fund  1,204.99 -0.76 -2.76 4.46 14.59 10.42 2.27 IN ITS Motilal Oswal Flexi Cap Parag Parikh Flexi Cap Fund
CATEGORY.
HDFC Index Fund Nifty 50 Plan  5,940.60 -1.73 -2.08 6.54 14.46 11.47 0.4 5.16 16.38
HDFC Index Fund - S&P BSE Sensex Plan  3,390.39 -1.14 -1.87 6.97 14.38 12.19 0.4 Taurus Flexi Cap Fund Quant Flexi Cap Fund
Nippon India Index Fund - S&P BSE Sensex Plan  282.71 -1.16 -1.96 6.91 14.3 11.88 0.46
5.54 14.05
Invesco India Largecap Fund  616.25 -2.05 -6.72 2.42 14.15 10.03 2.46
Nippon India Retirement IIFL Focused Equity Fund
Mirae Asset Large Cap Fund - Regular Plan  30,299.43 -1.82 -2.91 3.76 14.14 10.97 1.59
Tata S&P BSE Sensex Index Fund - Regular Plan  137.06 -1.17 -1.94 6.68 13.78 11.77 0.58 7 13.25
Axis Bluechip Fund  32,322.11 -3.01 -6.03 -1.91 12.86 12.24 1.69 IDFC Focused Equity SBI Focused Equity Fund

EQUITY: LARGE & MIDCAP 7.58 13.17

Quant Large and Mid Cap Fund  155.43 -3.87 3.11 12.03 24.22 12.71 2.31 24.22% DSP Focus Fund UTI Flexi Cap Fund
Mirae Asset Emerging Bluechip Fund - Regular Plan  20,663.71 -1.93 -4.49 2.37 21 14.29 1.69 THE 3-YEAR
Axis Growth Opportunities Fund - Regular Plan  7,070.61 -4.35 -4.68 0.31 20.49 — 2.01 RETURN
Canara Robeco Emerging Equities Fund - Regular Plan  12,768.56 -1.18 -3.22 3.82 20.3 12.1 1.86 OF QUANT
LARGE AND
Equity: Mid-cap 3-year returns
SBI Large & Midcap Fund  6,394.23 -2.35 -1.57 6.42 18.76 12.55 1.88
MID CAP IS 16.09
Edelweiss Large & Mid Cap Fund Regular Plan  1,269.68 -0.46 -1.64 4.17 18.58 12.58 2.27 THE HIGH-
36.43
Kotak Equity Opportunities Fund - Regular Plan  9,222.59 -1.05 0.49 5.92 18.45 11.58 1.83 EST IN ITS Franklin India Prima Fund PGIM India Midcap Opportunities

EQUITY: FLEXI CAP

CATEGORY. 17.12 33.21
PGIM India Flexi Cap Fund - Regular Plan  4,241.13 -4.12 -8.03 -2.6 22.9 13.12 1.98 L&T Midcap Fund Quant Mid Cap Fund
Parag Parikh Flexi Cap Fund - Regular Plan  22,323.99 -3.65 -6.4 -0.97 22.62 16.57 1.94 17.23 27.41
HDFC Retirement Savings Fund Equity Plan  2,087.87 -0.6 0.3 5.46 20.59 12.4 2.24 DSP Midcap Fund SBI Magnum Midcap Fund
IIFL Focused Equity Fund - Regular Plan  2,777.90 -1.81 -6.09 1.61 20.02 14.05 1.96 17.38 26.04
UTI Flexi Cap Fund - Regular Plan  22,656.75 -4.18 -7.27 -4.28 19.17 13.17 1.97
Sundaram Mid Cap Fund Edelweiss Mid Cap Fund
Union Flexi Cap Fund  1,084.67 -2.48 -4.09 2.18 18.46 11.7 2.32
Sundaram Focused Fund  648.72 -4.33 -6.15 0.85 18.17 11.6 2.57 18.15 25.89
Canara Robeco Flexi Cap Fund - Regular Plan  7,102.55 -1.81 -5.04 2.93 17.59 12.9 1.92 IDBI Midcap Fund Motilal Oswal Midcap 30
SBI Focused Equity Fund  23,804.00 -3.27 -6.34 1.84 16 13.25 1.63
Axis Flexi Cap Fund - Regular Plan  9,696.34 -3.9 -6.94 -2.52 13.93 — 2.03

EQUITY: MID CAP Equity: Small-cap 3-year returns

PGIM India Midcap Opportunities Fund - Regular Plan  5,168.64 1.45 -1.82 8.98 36.43 17.2 2 36.43%
Edelweiss Mid Cap Fund - Regular Plan  1,863.52 -0.98 0.3 4.67 26.04 14.13 2.11 THE 16.65 42.4
Kotak Emerging Equity Fund Regular Plan  18,258.63 -0.97 1.54 6.51 24.77 13.94 1.75 3-YEAR Aditya Birla Sun Life Quant Small Cap Fund
RETURN OF
Nippon India Growth Fund  11,267.89 -1.29 -0.48 6.57 23.22 13.3 1.89
PGIM INDIA 19.98 36.11
Axis Midcap Fund  16,566.73 -1.67 -1.94 2.91 22.83 16.36 1.93 HSBC Small Cap Equity Bank of India Small Cap Fund
MIDCAP
Invesco India Mid Cap Fund  2,148.46 -2.51 -4.19 2.04 22.61 13.43 2.07 OPP IS 20.71 35.97
THE HIGH-
EQUITY: SMALL CAP EST IN ITS Franklin India Smaller Canara Robeco Small Cap Fund
Kotak Small Cap Fund - Regular Plan  7,079.71 -4 -3.06 4.95 32.75 16.05 1.96 CATEGORY. 21.53 32.75
Nippon India Small Cap Fund  18,358.16 -3.77 -1.26 9.31 32 16.61 1.94
HDFC Small Cap Fund Kotak Small Cap Fund
SBI Small Cap Fund  11,646.28 -2.04 0.13 8.83 28.03 17.51 1.74
Axis Small Cap Fund - Regular Plan  8,955.50 -3.5 -2.84 5.95 27.87 17.87 2.04 24.99 32.39
IDBI Small Cap Fund Edelweiss Small Cap Fund
EQUITY: VALUE ORIENTED
SBI Contra Fund  4,670.06 0.87 3.39 14.64 26.72 13.51 1.94
UTI Value Opportunities Fund - Regular Plan  6,054.55 0 -2.65 3.61 17.98 11.88 2.15 Hybrid: Aggressive 5-year returns
Invesco India Contra Fund  8,210.76 -0.04 -2.7 4.55 17.68 12.61 1.78
Kotak India EQ Contra Fund - Regular Plan  1,192.39 -1.47 -1.94 4.58 16.46 12.54 2.3
4.28 17.61
EQUITY: ELSS Nippon India Equity Hybrid Quant Absolute Fund
Quant Tax Plan  1,370.20 -4.51 0.7 7.91 34.23 20.33 2.62 34.23% 5.56 12.68
Bank of India Tax Advantage Fund - Regular Plan  551.26 -3.6 -4.75 -1.92 23.72 13.9 2.5
THE 3-YEAR LIC MF Children's Gift Fund ICICI Prudential Equity & Debt Fund
IDFC Tax Advantage (ELSS) Fund - Regular Plan  3,399.14 -4.06 -2.58 6.97 20.82 12.56 1.96 RETURN OF
Canara Robeco Equity Tax Saver Fund - Regular Plan  3,517.62 -0.29 -3.71 3.43 20.31 14.51 2.01 QUANT TAX 5.65 11.55
Union Long Term Equity Fund  478.56 -1.7 -2.14 5.32 19.1 11.79 2.53 PLAN IS IDBI Hybrid Equity Fund Bank of India Mid & Small Cap Equity
THE HIGH-
Mirae Asset Tax Saver Fund - Regular Plan  11,494.59 -2.58 -3.91 3.08 19.02 14.07 1.66
EST IN ITS
5.93 11.12
DSP Tax Saver Fund  9,091.49 -1.31 -2.83 2.21 18.32 12.04 1.78 CATEGORY. PGIM India Hybrid Equity Baroda BNP Paribas Aggressive Hybrid
JM Tax Gain Fund  60.92 -0.88 -4.11 4.07 17.47 11.84 2.47
6.55 10.87
Kotak Tax Saver Regular Plan  2,528.82 -1.11 -1.04 5.99 17.21 11.55 2.04
IDFC Asset Allocation Fund HDFC Children's Gift Fund
Axis Long Term Equity Fund  27,627.69 -5.76 -7.66 -6.76 12.75 10.59 1.61
ANNUALISED RETURNS IN % AS ON 27 JULY 2022.
 smart stats
The Economic Times Wealth August 1-7, 2022 15

ETW FUNDS 100 RETURNS (%)

1 Top 5 SIPs
Value Research Net Assets Expense
Fund Rating (` Cr) 3-Month 6-Month 1-Year 3-Year 5-Year Ratio

HYBRID: EQUITY SAVINGS

Top 5 equity schemes based
Mahindra Manulife Equity Savings Dhan Sanchay  417.78 -2.11 -2.07 3.7 10.83 6.98 2.51
Kotak Equity Savings Fund - Regular Plan  1,908.19 0.01 1.14 6.65 9.37 7.9 2.13
on 10-year SIP returns
Edelweiss Equity Savings Fund - Regular Plan  315.08 -0.65 -0.41 2.44 9.34 7.73 2.07 Nippon India Small Cap Fund
23.30
HYBRID: AGGRESSIVE (EQUITY-ORIENTED)
ICICI Prudential Equity & Debt Fund  18,586.87 -2.3 -0.27 15.98 18.47 12.68 1.8 15.98% SBI Small Cap Fund
Quant Absolute Fund  437.03 -1.68 3.44 7.84 26.94 17.61 2.31 THE 1-YEAR 23.17
Kotak Equity Hybrid Fund - Regular Plan  2,539.24 -0.49 -0.62 6.56 16.76 10.71 2.08 RETURN OF
ICICI PRU Quant Tax Plan
HDFC Children's Gift Fund  5,216.99 1.3 0.12 5.18 16.02 10.87 1.96
EQUITY &DEBT 22.74
SBI Equity Hybrid Fund  48,908.09 -2.16 -1.16 4.88 13.36 10.77 1.51 FUND IS THE
Mirae Asset Hybrid Equity Fund - Regular Plan  6,395.79 -1.26 -2.51 2.93 12.97 10.32 1.8 HIGHEST IN ITS Mirae Asset Emerging Bluechip Fund
Canara Robeco Equity Hybrid Fund - Regular Plan  7,428.51 -0.78 -2.89 2.59 14.84 10.86 1.87 CATEGORY.
20.67
HDFC Retirement Savings Fund - Hybrid Equity Plan  796.65 0.58 -0.69 1.98 14.33 9.99 2.44
Axis Equity Hybrid Fund - Regular Plan  1,729.85 -2.22 -4.78 0.83 12.84 — 2.2 Kotak Small Cap Fund
Axis Children's Gift - Regular Plan  639.91 -3.64 -7.15 0.71 12.72 9.73 2.46 20.26
Baroda BNP Paribas Aggressive Hybrid Fund  721.76 -1.52 -2.66 0.49 14.47 11.12 2.4
SIP: SYSTEMATIC % ANNUALISED RETURNS
DSP Equity & Bond Fund  6,836.89 -1.23 -4.31 -1.98 13.86 9.5 1.86
INVESTMENT PLAN AS ON 27 JULY 2022
Bank of India Mid & Small Cap Equity & Debt Fund  322.07 -7.2 -7.24 -2.65 24.35 11.55 2.55

HYBRID: CONSERVATIVE (DEBT-ORIENTED)

ICICI Prudential Regular Savings Fund
SBI Conservative Hybrid Fund
Kotak Debt Hybrid Fund - Regular Plan



3,204.22
6,079.02
1,468.39
0.49
0.12
-0.18
0.78
0.82
-0.15
6.47
5.75
4.5
8.95
10.61
10.68
7.77
7.18
7.89
1.74
1.1
1.83
2 Top 5 MIPs
Top 5 MIP schemes based on
SBI Magnum Children's Benefit Fund - Savings Plan  85.34 -0.99 -1.1 3.83 11.23 8.66 1.2 3-year SWP returns
Canara Robeco Conservative Hybrid Fund  1,117.58 -0.16 -0.2 2.69 9.28 7.41 1.82
Bank of India Conservative Hybrid Fund
DEBT: MEDIUM- TO LONG-TERM
13.91
Aditya Birla Sun Life Income Fund
ICICI Prudential Bond Fund


1,532.87
2,576.08
-0.19
0.42
0.17
1.09
2.25
1.89
6.06
6.17
5.93
6.01
0.89
1.18
2.25% SBI Magnum Children's Benefit Fund
THE 1-YEAR
SBI Magnum Income Fund  1,543.25 0.14 0.55 1.6 6.65 6.33 1.46
RETURN OF 11.38
Kotak Bond Fund - Regular Plan  1,550.79 -0.29 -0.42 1.34 5.21 5.26 1.8 ABSL INCOME Kotak Debt Hybrid Fund
FUND IS
DEBT: MEDIUM-TERM THE HIGH- 11.01
ICICI Prudential Medium Term Bond Fund  6,355.24 0.81 1.69 3.58 7.27 6.55 1.4 EST IN ITS SBI Conservative Hybrid Fund
Axis Strategic Bond Fund  1,681.95 0.56 1.26 3.56 6.9 6.56 1.08 CATEGORY.
HDFC Medium Term Debt Fund  3,612.00 0.11 0.42 2.56 6.23 6.28 1.29 10.65
SBI Magnum Medium Duration Fund  9,384.37 0.17 0.72 2.46 7 7.02 1.21 Canara Robeco Conservative Hybrid
DEBT: SHORT-TERM 9.49
Aditya Birla Sun Life Short Term Fund  4,630.66 0.71 1.61 3.39 6.52 6.61 1.09 3.39% SWP: SYSTEMATIC % ANNUALISED RETURNS
ICICI Prudential Short Term Fund  15,492.50 0.85 1.74 3.38 6.63 6.52 1.12 THE 1-YEAR WITHDRAWAL PLAN AS ON 27 JULY 2022
Axis Short Term Fund  6,539.05 0.43 1.18 2.94 6.26 6.51 0.96 RETURN
HDFC Short Term Debt Fund  13,834.21 0.37 1.03 2.72 6.61 6.88 0.74 OF ADITYA
BIRLA SUN

3
Nippon India Short Term Fund  7,283.85 0.07 0.76 2.61 6.2 6.15 1.15

DEBT: DYNAMIC BOND

LIFE SHORT
TERM FUND Large Cap: Cash holdings
IS THE HIGH-
HDFC Dynamic Debt Fund  473.15 -0.02 -0.27 0.34 6.18 4.35 1.74 EST IN ITS
Kotak Dynamic Bond Fund - Regular Plan  2,065.01 -0.46 0.08 2.15 5.83 6.71 1.21 CATEGORY.
8.07
Quantum Dynamic Bond Fund - Regular Plan  83.64 0.69 1.67 3.11 5.68 5.68 0.73 7.09
ICICI Prudential All Seasons Bond Fund  5,616.01 0.73 1.67 3.12 6.94 6.55 1.37 6.06 5.61 5.15
IIFL Dynamic Bond Fund - Regular Plan  576.15 -0.01 1.17 3.7 6.02 5.9 0.52

DEBT: CORPORATE BOND

Nippon India Corporate Bond Fund  2,019.37 0.41 1.29 3.37 6.31 6.51 0.63
ICICI Prudential Corporate Bond Fund  15,110.05 0.59 1.56 3.32 6.55 6.73 0.58 Expense as on 30 June 2022
Aditya Birla Sun Life Corporate Bond Fund  13,326.37 0.36 1.33 3.02 6.88 7.1 0.46 Returns as on 27 July 2022 Baroda ICICI UTI JM Canara
Kotak Corporate Bond Fund - Standard Plan  8,902.49 0.21 0.97 2.94 6.12 6.74 0.65 Assets as on 30 June 2022 BNP Prudential Master- Focused Robeco
HDFC Corporate Bond Fund  21,663.40 0.01 0.6 2.37 6.5 6.86 0.61 Rating as on 30 June 2022 Paribas Bluechip share Fund Bluechip
Fund Fund Equity
Fund
All equity funds ranked on 3-year returns. Debt funds ranked on 1-year returns.
Did not find your fund here? % OF ASSETS AS ON 30 JUNE 2022
Log on to www.wealth.economictimes.com for an exhaustive list.

Debt: Dynamic bond fund

Methodology
The Top 100 includes only those funds that have a 5- or
EQUITIES (figures over the past one year)
Large-cap: Mostly invested in large-cap companies.
4 lowest expense ratio
4-star rating from Value Research. The rating is determined
by subtracting a fund’s risk score from its return score. Multi-cap: Mostly invested in large- and mid-cap
companies.
FUND
The result is assigned stars according to the following
distribution: Mid-cap: Mostly invested in mid-cap companies. RAISER 0.62
0.66 0.67 0.69

 Top 10% Small-cap: Mostly invested in small-cap companies. 0.52

`2.12
 Next 22.5% Tax planning: Offer tax rebate under Section 80C.
(Not covered
 Middle 35% in ETW Funds International: More than 65% of assets invested abroad.
 Next 22.5% 100 listing) Income: Average maturity varies according to objective.
  Bottom 10% Gilt: Medium- and long-term; invest in gilt securities. LAKH CRORE
Fixed-income funds less than 18 months old and equity funds Equity-oriented: Average equity exposure more
less than three years old have been excluded. This ensures than 60%. was the net AUM of large- IIFL Axis All Axis Aditya Nippon
that all the funds have existed long enough to be tracked for Debt-oriented aggressive: Average equity exposure
cap funds in June 2022, Dynamic Seasons Dynamic Birla Sun India
consistency of performance. Given the focus on long-term the highest among equity Bond Debt FoF Bond Life Ac- Dynamic
between 25-60%.
investing, liquid funds, short-term funds and FMPs are not Fund Fund tive Bond
part of the list. For the same reason, we have considered only Debt-oriented conservative: Average equity exposure schemes. It constitutes 16.5% % AS ON 30 JUNE 2022
the growth option of funds that reinvest returns instead of less than 25%. of the net AUM of equity
offering dividends that increase the NAV of funds. Arbitrage: Seek arbitrage opportunities between equity schemes, according to AMFI. % EXPENSE RATIO IS CHARGED ANNUALLY.
Despite these rigorous filters, the list includes 2/3 funds of and derivatives.
METHODOLOGY OF TOP 100 FUNDS ON
each category to maximise choice from the best funds. Asset allocation: Invest fully in equity or debt as per WWW.WEALTH.ECONOMICTIMES.COM
The fund categories are: market conditions.
 loans and deposits
16 The Economic Times Wealth August 1-7, 2022

LOANS & DEPOSITS

ET WEALTH collaborates with ETIG to provide a comprehensive ready reckoner of loans and fixed-income
instruments. Don’t miss the information on investments for senior citizens and a simplified EMI calculator.

Top five bank FDs

TENURE: 1 YEAR
Interest rate (%) What `10,000
HOME LOAN RATES
compounded qtrly will grow to
With effect from October 2019, all banks have made the transition to
RBL Bank 6.50 10,666
external benchmarks for pricing new home loans. Most banks have
Bandhan Bank 6.25 10,640
DCB Bank 6.10 10,624
picked the RBI repo rate as the external benchmark.
IndusInd Bank
IDFC First Bank
6.00
5.75
10,614
10,588
REPO RATE: 4.90%
FOR SALARIED FOR SELF-EMPLOYED (%)
BANK
TENURE: 2 YEARS RLLR (%) FROM (%) TO (%) FROM (%) TO (%) WEF
RBL Bank 6.75 11,432 Punjab National Bank 7.50 6.80 8.05 7.00 8.15 9 June 2022
DCB Bank 6.60 11,399
Bank of India 7.25 6.90 8.60 6.90 8.75 4 May 2022
Bandhan Bank 6.50 11,376
IDFC First Bank 6.50 11,376 Axis Bank 7.00 7.00 7.30 7.05 7.35 8 June 2022
IndusInd Bank 6.50 11,376 Canara Bank 7.30 7.05 9.25 7.10 9.30 7 June 2022
TENURE: 3 YEARS Indian Overseas Bank 6.85 7.05 7.30 7.05 7.30 25 Jan 2022
DCB Bank 6.60 12,170 Karur Vysya Bank 7.45 7.15 9.35 7.15 9.35 9 May 2022
RBL Bank 6.55 12,152
Bank of Maharashtra 7.70 7.30 8.70 7.55 9.20 10 June 2022
Bandhan Bank 6.50 12,134
Union Bank of India 7.70 7.40 9.10 7.40 9.10 11 June 2022
IDFC First Bank 6.50 12,134
IndusInd Bank 6.50 12,134 Punjab & Sind Bank 7.50 7.40 8.25 7.55 8.50 8 June 2022

TENURE: 5 YEARS Indian Bank 7.70 7.40 8.15 7.55 8.30 9 June 2022
DCB Bank 6.60 13,872 UCO Bank 7.80 7.40 7.60 7.40 7.60 9 June 2022
RBL Bank 6.55 13,838 Bank of Baroda 7.45 7.45 8.80 7.45 8.80 15 June 2022
IDFC First Bank 6.50 13,804
Kotak Mahindra Bank 7.50 7.50 8.00 7.55 8.10 8 June 2022
IndusInd Bank 6.50 13,804
SBI Term Loan 7.55 7.55 8.05 7.75 8.25 15 June 2022
Karur Vysya Bank 5.90 13,402
ICICI Bank 7.60 7.60 8.30 7.70 8.45 8 June 2022
Karnataka Bank 7.50 7.74 9.09 7.74 9.09 1 June 2022
Top five senior citizen bank FDs Central Bank of India 7.75 7.75 8.20 7.75 8.20 9 June 2022
Interest rate (%) What `10,000
TENURE: 1 YEAR compounded qtrly will grow to J & K Bank 7.85 7.85 8.25 7.85 8.25 10 June 2022
Bandhan Bank 7.00 10,719
Dhanlaxmi Bank 7.00 7.85 8.50 8.35 9.00 1 June 2022
RBL Bank 7.00 10,719
SBI Max Gain 7.55 7.95 8.45 8.05 8.55 15 June 2022
DCB Bank 6.60 10,677
IndusInd Bank 6.50 10,666 South Indian Bank 7.25 8.25 10.50 8.60 11.00 1 June 2022
IDFC First Bank 6.25 10,640

TENURE: 2 YEARS
Bandhan Bank 7.25 11,545
Your EMI for a loan of `1 lakh
RBL Bank 7.25 11,545 TENURE 5 YEARS 10 YEARS 15 YEARS 20 YEARS 25 YEARS
DCB Bank 7.10 11,511
@ 7% 1,980 1,161 899 775 707
IDFC First Bank 7.00 11,489
IndusInd Bank 7.00 11,489 @ 8% 2,028 1,213 956 836 772
TENURE: 3 YEARS
Bandhan Bank 7.25 12,405
@ 9% 2,076 1,267 1,014 900 839
DCB Bank 7.10 12,351
@ 10% 2,125 1,322 1,075 965 909
RBL Bank 7.05 12,333
FIGURES ARE IN `. USE THIS CALCULATOR TO CHECK YOUR LOAN AFFORDABILITY.
IDFC First Bank 7.00 12,314
FOR EXAMPLE, A `5 LAKH LOAN AT 12% FOR 10 YEARS WILL TRANSLATE INTO AN EMI OF `1,435 X 5 = `7,175
IndusInd Bank 7.00 12,314

TENURE: 5 YEARS
Post office deposits Interest (%)
Minimum
investment (`)
Maximum
investment (`)
Features
Tax
benefits
DCB Bank 7.10 14,217
RBL Bank 7.05 14,183 Sukanya Samriddhi Yojana 7.60 250 1.5 lakh p.a. One account per girl child 80C
IDFC First Bank 7.00 14,148
IndusInd Bank 7.00 14,148 Senior Citizens' Savings Scheme 7.40 1,000 15 lakh 5-year tenure, minimum age 60 yrs 80C
Axis Bank 6.50 13,804
Public Provident Fund 7.10 500 1.5 lakh p.a. 15-year tenure, tax-free returns 80C

Kisan Vikas Patra 6.90 1,000 No limit Can be encashed after 2.5 years Nil
Top five tax-saving bank FDs 5-year NSC VIII Issue 6.80 1,000 No limit No TDS 80C
Interest What `10,000
TENURE: 5 YEARS AND ABOVE rate (%) will grow to
Time deposit 5.5-6.7 1,000 No limit Available in 1, 2, 3, 5 year tenures 80C#
DCB Bank 6.60 13,872
RBL Bank 6.55 13,838 Single 4.5 lakh 5-year tenure, monthly returns Nil
Post Office Monthly Income
IDFC First Bank 6.50 13,804 6.60 1,000
Scheme
Joint 9 lakh 5-year tenure, monthly returns Nil
IndusInd Bank 6.50 13,804
Karur Vysya Bank 5.90 13,402 Recurring deposits 5.80 100 No limit 5-year tenure Nil

Savings account 4.00 500 No limit `10,000 interest tax-free Nil

ALL DATA SOURCED FROM ECONOMIC TIMES INTELLIGENCE GROUP
(ETIGDB@TIMESGROUP.COM) Data as on 28 July 2022 # Benefit available only for 5-year deposit
 market watch
The Economic Times Wealth August 1-7, 2022 17

ALTERNATIVE INVESTMENT
RETURNS MONITOR
The scope and attractiveness of alternative investments is increasing. Here’s a weekly tracker of returns from such investments. But don’t
compare these with returns from traditional investments since the proportion and purpose of alternative investments is vastly different.

Gold (995) (`) Silver (`) Platinum ($/troy ounce) WTI Crude ($/barrel)
47,570 51,017 66,386 55,972 1,068.68 893.65 72.39 97.26
28 JULY 2021 28 JULY 2022 28 JULY 2021 28 JULY 2022 28 JULY 2021 28 JULY 2022 28 JULY 2021 27 JULY 2022

PRICE OF 10 GM GOLD PRICE OF 1 KG SILVER

CHANGE
X 1 WEEK 2.5% 1 WEEK 3.83% 1 WEEK 1.89% 1 WEEK -2.25%
X 1 YEAR 7.25% 1 YEAR -15.69% 1 YEAR -16.38% 1 YEAR 34.36%

PENNY STOCKS UPDATE

Penny stocks as a recommended non-traditional investment? Not exactly. ET WEALTH
neither has the expertise nor does it recommend investing in such stocks. But since the
relatively ‘low’ cost of investment attracts some investors to penny stocks, we provide
a weekly snapshot of this most volatile and uncertain type of stock investing.

Top price gainers Top volume gainers

MARKET 1-WEEK (%) 1-MTH (%) 1-MONTH AVG 1-MONTH AVG MKT CAP MARKET 1-WEEK (%) 1-MTH (%) 1-MTH AVG 1-MONTH AVG MKT CAP
STOCK PRICE (`) CHANGE CHANGE VOL (LAKH) VOL CHG (%) (`CR) STOCK PRICE (`) CHANGE CHANGE VOL (LAKH) VOL CHG (%) (`CR)

DSJ Keep Learning Ltd 5.12 27.36 182.87 0.16 168.69 42.6 Usha Martin Education 5.50 2.04 -3.68 0.29 2,846.73 14.52
Regency Ceramics Ltd 9.59 27.19 161.31 0.05 82.02 25.36 Prime Urban Develop. 6.20 4.91 -30.18 0.02 2,352.89 16.52
Integra Essentia Ltd 5.95 22.43 138 25.80 278.95 229.49 PVP Ventures Ltd 8.06 27.13 56.50 4.09 1,539.93 197.51
Sturdy Industries Ltd 1.16 24.73 132 3.30 211.4 17.55 Excel Realty N Infra Ltd 8.09 -9.10 18.10 4.09 984.95 76.09
PVP Ventures Ltd 8.06 27.13 56.50 4.09 1,539.93 197.51 Shree Global Tradefin 7.89 8.23 5.34 22.74 980.84 1,003.69
Venlon Enterprises Ltd 9.65 4.44 55.14 0.20 87.7 50.41 Alps Industries Ltd 3.05 -14.08 -11.08 0.47 792.41 11.93
JMD Ventures Ltd 7.52 9.94 45.17 0.05 -75.91 10.85 Ontic Finserve Ltd 1.63 -13.76 12.41 1.39 512.70 14.67
Croissance Ltd 8.70 3.08 41 0.26 -68.51 59.59 Vikas Proppant & Gran 0.98 13.95 -34.23 26.79 445.60 50.44
KCL Infra Projects Ltd 3.84 26.32 33.80 0.76 -23.69 10.12 Viaan Industries Ltd 0.96 24.68 5.49 2.76 409.45 10.58
Bartronics India Ltd 5.33 22.53 29.37 0.13 9.5 18.15 Housing Development 4.58 -5.95 -12.43 1.82 358.21 217.09

Top price losers Top volume losers

Kanani Industries Ltd 7.80 -19.42 -46.21 1.71 86.19 77.14 Vikas Lifecare Ltd 5.15 -0.19 -5.85 11.49 -82.85 630.51
Sintex Plastics Tech 3.62 -11.06 -37.04 11.08 174.18 230.3 Impex Ferro Tech Ltd 6.62 -6.63 -28.43 1.18 -73.87 58.21
Seacoast Shipping Servi 2.14 -6.14 -34.36 29.16 24.59 72.05 Sawaca Business Mach 1.59 -11.67 19.55 6.99 -72.31 18.19
Vikas Proppant & Granite 0.98 13.95 -34.23 26.79 445.6 50.44 GG Engineering Ltd 2.38 -2.06 -2.86 3.12 -71.64 24.54
Impex Ferro Tech Ltd 6.62 -6.63 -28.43 1.18 -73.87 58.21 Prismx Global Ventures 5.04 -6.49 -10.64 1.70 -69.73 204.62
Sulabha Enggineers Ltd 4.85 -2.81 -22.52 1.65 25.96 48.74 ISF Ltd 2.97 -13.41 1.02 4.31 -67.62 28.22
BCL Enterprises Ltd 1.84 -11.11 -22.36 16.18 -7.92 21.45 Evexia Lifecare Ltd 1.90 -21.81 9.83 37.39 -62.33 117.67
Suryachakra Power Cor. 0.87 -5.43 -22.32 1.59 -8.04 13.02 Sun Retail Ltd 0.76 -5.00 -9.52 3.96 -61.54 11.8
NCL Research & Financial 0.82 -10.87 -21.90 70.54 57.88 87.76 Tatia Global Venture Ltd 1.62 0.62 14.89 1.41 -57.10 24.56
Filatex Fashions Ltd 5.96 -1.97 -21.48 2.31 8.64 17.32 Vikas Ecotech Ltd 3.70 -0.27 -0.80 15.42 -55.08 350.32

STOCKS HAVE BEEN SELECTED USING THE FOLLOWING FILTERS: PRICE LESS THAN `10, ONE-MONTH AVERAGE VOLUME GREATER THAN OR EQUAL TO 1 LAKH, AND MARKET
CAPITALISATION GREATER THAN OR EQUAL TO `10 CRORE. DATA AS ON 28 JULY 2022. SOURCE: ETIG DATABASE AND BLOOMBERG.
 mutual funds
18 The Economic Times Wealth August 1-7, 2022

NIPPON INDIA GROWTH

Manager inspires confidence

ET Wealth collaborates with Value Research to analyse top mutual funds. We examine the key fundamentals
of the fund, its portfolio and performance to help you make an informed investment decision.

HOW THE FUND HAS PERFORMED Top 5 sectors in portfolio (%)

Point-to-point returns (%)

BASIC Financial 24.14

FUND BENCHMARK CATEGORY AVERAGE FACTS Services 12.31

Healthcare
7.97
24.98 DATE OF LAUNCH
23.03 22.62
10 AUGUST 1995 Capital goods 6.84
CATEGORY
13.02 12.88 EQUITY Automobile 6.84
11.36
6.09 TYPE
3.17 3.72 The fund portfolio takes a
MID CAP substantial tilt towards financials.
AUM*
1-YEAR 3-YEAR 5-YEAR
`11,268 Crore
BENCHMARK
The fund has beaten its index and AS ON 26 JULY 2022 Top 5 stocks in portfolio (%)
peers over the past year. NIFTY MIDCAP 150
TOTAL RETURN INDEX Varun Beverages 4.51
Cholamandalam
3.67

Rolling returns (%)

WHAT IT Financial Holdings
Max Financial
3.18
COSTS
FUND BENCHMARK Services
The Federal
19.57 Bank 2.95
1-YEAR AU Small Finance
NAV** 2.80
21.33 Bank
BONUS
`330.10 The fund portfolio is heavily diversified
13.10
3-YEAR
GROWTH OPTION with modest positions in top bets.
14.56 `1,982.96
IDCW
13.29 `73.29 Recent portfolio changes
5-YEAR MINIMUM INVESTMENT
14.71 New Entrants
`100
MINIMUM SIP AMOUNT Endurance Technologies, Indian Oil
The fund’s long term track record indicates `100 Corporation, M&M, MRF, Steel Authority Of
chronic underperformance relative to index. AS ON 26 JULY 2022
India, Ambuja Cements, Campus Activewear,
EXPENSE RATIO*** (%)
1.89 LIC, Prudent Corporate Advisory Services,
Note: Different benchmark (S&P BSE 150 MidCap TRI) is used due to non availability of stated benchmark data Tata Motors, Tech Mahindra, Zomato, 3M India,
EXIT LOAD
The above figures denote daily average rolling return over past decade for relevant time frames. Bandhan Bank.
0.1% for redemption
within 30 days
Complete Exits
WHERE THE FUND INVESTS
*AS ON 30 JUNE 2022
**AS ON 26 JULY 2022
***AS ON 30 JUNE 2022
Exide Industries, Mphasis, PNC Infratech,
Vardhman Textiles, Infosys, Phoenix Mills,
Aarti Industries, Aavas Financiers, Coforge,
Portfolio asset Fund L&T Technology Services.
allocation style box
Growth Blend Value
How risky is it?
Large

Equity 95.41%
CAPITALISATION

Fund Category Index

Large-cap 20.34%
Standard Deviation 24.82 23.92 25.28
Medium

Mid-cap 63.01%
Small-cap 16.64% Sharpe Ratio 0.66 0.64 0.69
Small

FUND
Debt & Cash 4.59% Mean Return 19.86 18.69 20.94

MANAGER
BASED ON 3-YEAR PERFORMANCE.
INVESTMENT STYLE
The fund’s risk-return profile is not
The fund retains sizeable presence in both large- MANISH GUNWANI among the best in its category.
and small-cap stocks apart from its mid-cap tilt. TENURE: 4 YEARS, 8 MONTHS
Source: Value Research

Should
Earlier run as a market cap ag- proach, with the fund manager 30% of the entire portfolio. fund’s return profile followed
nostic fund, this fund shifted to ushering more diversification The fund maintains sizeable by a brief lull, but is finding its

You the mid-cap mandate in 2018,

preceded by a change in fund
in the portfolio. The emphasis
is on keeping risk contained
presence in both large- and
small-cap stocks apart from its
footing again. The presence of
a proven fund manager at its

Buy manager a year earlier. This

sparked a realignment in its ap-
with modest positions—the top
10 stocks account for less than
mid-cap focus. The transition
initially sparked a pick up in
helm provides comfort for the
long term.
 pick of the week
The Economic Times Wealth August 1-7, 2022 19

Nuvoco Vistas Corp: Cementing growth

Increase in demand, innovative products and cost control initiatives provide strong growth visibility.

N Fundamentals
uvoco Vistas is a cement player with a strong market gistics and dealers will aid in increasing market penetration.
share in eastern India and a presence in the North. It Third, it enjoys strong R&D and technological capabilities
has a capacity of 23.82 million tonnes and offers a di- which help create innovative products. Also, the company CONSENSUS
ACTUAL
ESTIMATE
versified product range, such as ready-mix concrete, is constructing alternate fuel material handling systems at
2021 2022 2023 2024
modern building materials and different cement varieties. Nimbol and Risda cement plants, which are expected to re-
Revenue (` cr) 7,333.19 9,318.03 10,658.17 11,773.81
In 2021-22, the company reported 24% y-o-y growth in rev- duce cost headwinds in a volatile inflationary environment. It
enue from operations, despite significant rise in the cost of has planned a capex of around `2,500 crore over the next three EBITDA(` cr) 1,460.50 1,498.74 1,610.34 2,048.62

coal and pet coke. The performance was supported by an in- years, which will be used for capacity expansion. Net Income (` cr) -34.66 30.26 164.59 502.04

crease in demand from construction Fourth, the company has a Basic EPS (`) -1.09 0.87 4.78 14.04
and infrastructure sectors, cost effi- strong liquidity profile. According
ciency measures led by utilisation of
Analysts’ views to CRISIL, Nuvoco could generate Valuations PBV PE
DIVIDEND
YIELD (%)
alternate fuel sources, and synergy annual accruals of `1,300-1,500 Nuvoco Vistas Corporation 1.33 -- 0.00
benefits from the Nu-Vista acquisi- 2 crore in the next two years, which
11 will support timely repayment of Ultra Tech Cement 3.70 25.44 0.59
tion. The latter has led to cost reduc- Sell Buy Ambuja Cements 2.91 31.12 1.70
tions in the areas of procurement, debt obligations. The management
Shree Cement 4.21 31.54 0.44
manufacturing and logistics. aims to be debt free by 2025-26.
ACC 2.86 30.25 2.66
According to a CRISIL report, 2 Also, the stock trades at a dis-
the performance is expected to im-
prove in 2022-23. The majority of the
Hold count to the market benchmark
in terms of PBV of 1.33 times Brokerage calls TARGET
RECO DATE RESEARCH HOUSE ADVICE PRICE (`)
Bloomberg analysts who are track- compared to the BSE Sensex’s 4.1
ing the stock remain confident about times. According to Bloomberg 22 Jul Citi Buy 345
the company’s prospects. There are estimates, Nuvoco’s revenue and 12 Jul HDFC Research Buy 591
many reasons for such bullishness. Nuvoco Vistas has strong R&D and technological EBITDA will report 14.4% and 11 Jul Haitong Outperform 400
First, the cement demand is ex- capabilities, which help it to create innovative 7.4% y-o-y growth in 2022-23. 7 Jul Nirmal Bang Buy 356
pected to grow due to the revival products. The company has planned a capex of Selection methodology: We
around `2,500 crore over the next three years for 7 Jul DAM Capital Buy 375
in real estate demand and the gov- pick the stock that has shown the
capacity expansion and aims to be debt-free by then.
ernment’s push for infrastructure
spending. Affordable home loans, expansion of credit-linked
maximum increase in ‘consensus
analyst rating’ during the past month. The consensus rating Relative performance SENSEX
102.3
subsidy scheme, and work from home are some of the factors is arrived at by averaging all analyst recommendations after 100 MARKET PRICE: `329.05 86.5
that are driving the housing demand in Tier-1 and Tier-2 cit- 61.9
attributing weights to each of them (5 for strong buy, 4 for buy,
ies. On the other hand, government schemes like Pradhan 3 for hold, 2 for sell and 1 for strong sell) and any improvement
Mantri Awas Yojana and National Infrastructure Pipeline in consensus analyst rating indicates that the analysts are
will help drive cement consumption. The cement sector is getting more bullish on the stock. To make sure that we pick
expected to grow at 7-8% in 2022-23, according to Nuvoco’s only companies with decent analyst coverage, this search will
2021-22 annual report. be restricted to stocks with at least 10 analysts covering them.
Second, the company’s strong sales, marketing and distri- You can see similar consensus analyst rating changes during 23 AUG 2021 ET CEMENT NUVOCO VISTAS CORP 28 JUL 2022
bution channel and an extensive network of warehouses, lo- the past week in ETW 50 table. —Sameer Bhardwaj Nuvoco Vistas is compared with ET Cement. Stock price and index values
normalised to a base of 100. Source: ETIG and Bloomberg.

WHAT EXPERTS ADVISE

BUY RESEARCH STOCK 1-YEAR TARGET POTENTIAL
*STOCK PRICES AS ON 28 JULY

STOCK ADVICE COMMENT

HOUSE PRICE* (`) PRICE (`) UPSIDE (%)

Its has strong positioning in domestic agri-pipes market and backward integrated operations as well
Finolex Industries IDBI Capital Buy 140 195 39.3 as a healthy balance sheet. Also, the valuations have turned attractive after the recent correction.

It is well placed to capitalise on the surging demand from CV OEMs, railways, oil & gas and mining/
Ramkrishna Forgings Monarch Buy 173 237 37.0 earth-moving segments. Rising utilisation will improve both the margin and the return profile.

Maintain ‘buy’ due to continued investment in manpower, sales, robust collections, and market
Indiamart Yes Securities Buy 4,074 5,439 33.5 leadership in B2B online classified segment, plus strong play on rising adoption of internet in SMEs.
Initiate with ‘buy’ as it will be a beneficiary of the likely surge in power transmission capex,
Antique Stock
Hitachi Energy India Buy 3,160 4,200 32.9 growing investment in transportation sector, and data centers. A sharp uptick in order flows is
Broking expected, which will meaningfully boost the earnings in the future.

Prabhudas Positive growth momentum across regions coupled with price hikes in the recent past. Higher
Sharda Cropchem Buy 564 740 31.2
Lilladher agrochemicals growth and strong traction in non-agrochemicals segment are other positives.

Reiterate ‘buy’ as the company is a key beneficiary of an acceleration in IT spends, given its
Infosys Motilal Oswal Buy 1,503 1,760 17.1 capabilities around Cloud and Digital transformation. Robust order book, positive growth
guidance, and high headcount addition provides strong visibility.

REDUCE RESEARCH STOCK 1-YEAR TARGET POTENTIAL

STOCK ADVICE COMMENT
HOUSE PRICE* (`) PRICE (`) DOWNSIDE (%)

A sharp decline in international steel prices, volatile coking coal prices, concerns of weak export
JSW Steel Sharekhan Reduce 582 525 -9.8 volumes amid likelihood of a global economic slowdown. The net debt is likely to surge.

your queries
20 The Economic Times Wealth August 1-7, 2022
I want to invest `50 lakh for the educa-
tion of my two daughters. I will need the
money after four and a half years. Please
suggest where I should park the money.
Also, please explain the tax implications.
If your children are minors, then any interest
income generated will get clubbed with yours
and you would need to pay tax on it as per
your bracket. However, if your children are
major, then they are treated as separate enti-
ties for all investment and tax purposes. If
you split the `50 lakh between your two chil-
dren, then even at 10% returns, the interest
earned would be below the taxable limit. As
this fund is meant for your children’s educa-
tion, and that too in the short term, investing
in equity may not be a good idea. The mar-
kets are uncertain and this instability will last
for a couple of years, impacting returns. It is
best to look at instruments that provide de-
cent returns and high capital protection. Your
best option right now is to invest in bank or
post office FDs. Since you need the money in
four and a half years, tax saving FDs are out
as their span is for 5 years. If you can plan for
six months, then you can invest in them. You
can also consider regular FDs for shorter pe-
riods of 1-2 years and then reinvest in them.
You can also consider repo-linked FDs as in-
terest rates for these will continue to rise as
the repo rises. Spread the risk. Do not invest
more than `5 lakh in one bank with the same
set of account holders. Second, break up the
amount and invest in multiple FDs so that in
case you need to make part
payments before matu-
rity, you can do so
without affecting the
entire corpus.
Adhil Shetty
CEO, BankBazaar
I am a state government pensioner and my
gross pension would be `6.95 lakh for
2022-23. I am investing `1.5 lakh to avail
80C benefits. I have dividend income from
shares of about `62,000. I am getting yearly
interest of around `1.28 lakh from the SCSS.
Can I claim `50,000 from post office interest
from my pension income? I spend `15,000
per year on the treatment of health issues.
Can this expenditure be claimed in lieu of
medical health insurance policy?
You can claim `50,000 standard deduction
from pension as it is reportable under sal-
ary head. Also, you can claim `50,000 de-
duction from post office SCSS income un-
der Section 80 TTB. As for medical expens-
es, they can also be claimed up to `50,000
per year for senior citizens, if they are
paid in modes other than cash. There
should be no medical health insurance in
such cases. After assuming these deduc-
tions and taking into account the
information provided by
you, your taxable income
post deductions is work-
ing out to be `6.2 lakh.
Shubham Agrawal
Senior Taxation Advisor, TaxFile.in
QA
&
Our panel of experts will
answer questions related to
any aspect of personal
finance. If you have a query,
mail it to us right away.
QUESTION OF THE WEEK
I am 45 and planning to retire by 50. I
have a corpus of around `2 crore which
includes `1.35 crore in direct equity and
`65 lakh in MFs. The returns from pri-
vate equity as well as MFs are in red
because of the current market scenario.
What should be my strategy if I want to
earn a steady monthly income of around
`1.25 lakh after my retirement? I have a
life cover of `2 crore and a family floater
health cover of `5 lakh.
You should execute an exit strategy starting 2-3
years from now wherein you reduce your equity
exposure and move into debt funds and bank
deposits. If the whole corpus of `2 crore is de-
ployed and a return of 7% is assumed, you can
generate pre-tax income stream of around `1.16
lakh per month. However, the ideal way will be
to first set aside a sum equivalent to expenses
for a year — `15 lakh—for any emergencies. In
addition, part exposure to equities should con-
tinue, which will grow over time to combat infla-
tion. You can choose a simple product such as in-
dex funds to maintain equity portion of the
portfolio. Once the allocation towards equities
and contingency fund is done, the amount avail-
able to generate monthly cash flows will reduce.
At 50, you won’t be eligible for certain govern-
ment schemes, thus, the corpus can be parked
across instruments like the RBI Floating Rate
Saving Bonds, debt funds and fixed deposits.
Debt funds allow systematic with-
drawal which will reduce your
tax liability compared to
FDs. Your life cover seems
adequate; however, the
health cover should be
`15-20 lakh based on
the city of residence.
Prableen Bajpai
Founder, FinFix® Research
& Analytics
Along with two other MFs, I had initiated an
SIP investment in Motilal Oswal Flexible Fund
in 2018. Looking at its performance last month,
I stopped my SIP and diverted it to Quant Mid
Cap Fund. Still my investment till date of `1.87
lakh is in MOS Flexi Cap Fund which I want to
divert in some other MF. Please guide me.
I am 34. I took a `50 lakh term plan with disclo-
sure of sickle cell tread (not disease) in 2014.
Now my proposal for a new term plan of `50 lakh
with a critical illness rider (`10 lakh) has been
pushed back without any reason. I may get one if
I hide the problem as recommended by my advis-
er, which I don’t want to do. What should I do?
We understand your condition, but insurance fun-
damentally works on the principle of utmost good
faith. Therefore, it is never recommended to hide
any information from the proposal. In case the in-
surer finds out this undisclosed information, it can
lead to rejection of your claim and even nullifica-
tion of the policy on account of misinformation.
This defeats the entire purpose of buying a term
plan in the first place. Every insurer has a differ-
ent approach to existing conditions and cover
amount being asked for. You can check for various
riders available with your insurer or ask for cer-
tain customisations in your term plan. Specifical-
ly, in conditions like this, you may want to
compare and ask the insurer if they
would be willing to provide the plan
without riders or for a lower cover
amount and go ahead accordingly.
Sarbvir Singh
CEO, Policybazaar.com
My brother and I bought a house in 2015 and it was
registered in my name and my mother’s name. My
mother passed away in 2021 and we sold the house.
My brother and I have split the sale amount equally
between us. What are the long-term capital gains tax
implications for each of us? If we don’t need this
amount in the short term, what are the best options
to avoid paying LTCG tax? Can one of us pay LTCG tax
according to one’s share received and the other invest
it for the long term and not pay LTCG tax?
Any gains from the sale of residential property
would be subject to capital gains tax in the hands
of individuals according to their share in proper-
ty. In your case, the property would be considered
as a long-term capital asset as it was held for more
than 24 months and the applicable tax rate would
be 20% after indexation benefit. You can invest in
a residential property (purchase within 2 years or
constructed within 3 years after the date of trans-
fer) or invest the amount of capital gains in bonds
of certain PSUs like NHAI and REC within six
months of the transfer of property. Investment of
gains in bonds shall be subject to a maximum limit
of `50 lakh for each one of you. Be-
sides, each can invest or pay tax
on gains according to your own
individual decision.
Amit Maheshwari
Partner, AKM Global
Ask our experts
Have a question for the experts?
etwealth@timesgroup.com
Please note that Quant Midcap is a small fund and
may be subject to risk of AUM volatility. Its strate-
gy is also very momentum driven with high churn.
Keep exposure to it limited. Consider investing in a
combination of Parag Parikh Flexicap and Motilal
Oswal Nifty 500 Index Fund.
Vidya Bala, Co-Founder, PrimeInvestor.in
 mutual funds
The Economic Times Wealth August 1-7, 2022 21

Set up emergency fund for PORTFOLIO

DOCTOR
unexpected expenses Not many

ARINDAM
investors
Vijay Srivastava is saving for his child’s goals and retirement. Here’s what the doctor advised him: know
1 2 3 4 5 whether
EMERGENCY FUND: CHILD’S GRADUATION CHILD’S POST- CHILD’S MARRIAGE: RETIREMENT INCOME: they have
2 years (ABROAD): 14 years 25 years 26 years
GOALS

PRESENT COST:
`5 lakh
FUTURE COST: `5.6 lakh
PORTFOLIO
CHECK-UP
Investing in equity
funds for 6-7 years.
Built sizeable corpus.
Goals are ambitious
but small hikes in SIPs
can achieve them.
Direct stock investing
requires research.
Stick to mutual funds.
Marriage goal of `10
lakh too modest. In-
creased to `20 lakh.
Note from
the doctor
Very long-term insur-
ance plans of 50-60
4 Canara Robeco Flexicap
years are meaningless.
Avoid sector schemes.
Diversified funds yield
better results.
Review investments
and rebalance at least
once in a year.
Reduce risk when goal
is near so that you
don’t miss the target.
PRESENT COST: `30 lakh
FUTURE COST:
`1.14 crore
FUND NAME
1 Post Office Recurring Deposit
SBI Small Cap
2 Mirae Asset Large Cap (2 folios)
ICICI Pru Nifty 50 Index
Axis Bluechip
SBI Equity Hybrid
3 Tata Digital India
Nippon India Pharma
PGIM India Midcap Opportunities
Direct equity investments
Life insurance policies
5 PGIM India Flexicap
NPS Tier I & II
Provident Fund and PPF
TOTAL
GRADUATION (ABROAD):
18 years PRESENT COST: `20 lakh CURRENT NEED: `1.88 crore invested in
PRESENT COST: `30 lakh FUTURE COST: (`75,000 a month) the right
FUTURE COST: `1.67 cr `1.08 crore FUTURE COST: `10.9 crore funds and if their
fund portfolio is on
AMOUNT
INVESTED (`)
EXISTING
SIP (`) RECOMMENDED ACTION NEW SIP
(`) track. The Portfolio
Start SIPs of `10,000 in debt fund ICICI Pru Short Doctor assesses the
1,24,000 4,000 Term. Continue investing in recurring deposit but 14,000
switch to debt fund after maturity. health of the fund
2,64,892
Continue SIPs in this outstanding small-cap fund. Hike
4,000 amount by 5% every year. 4,000 portfolio, examines the
schemes and their
Increase SIPs to `6,000 in this outperforming large-
4,09,247 5,500 cap fund. Hike by 5% every year. 6,000
suitability with regard to
Continue SIPs in this index fund. Increase amount by
1,52,576 3,000 5% every year. 3,000 the goals and, if
2,80,069
Continue SIPs in this outstanding large-cap fund.
3,000 Hike by 10% every year. 3,000 required, recommends
Continue SIPs in this stable hybrid fund. Hike by corrective measures. The
2,43,582 2,500 10% every year. 2,500
advice given is based on
7,209 1,000 These sectoral schemes are likely to be volatile. 0
the performance of the
7,586 1,000 Switch corpus to PGIM India Midcap Opportunities.
funds, the risk profile of
Start SIPs of `3,000 in this outstanding mid-cap
0 0 fund. Hike amount by 10% every year. 3,000 the investor as well as
Start SIPs of `4,000 in this outstanding flexi-cap his financial goals.
0 0 fund. Increase by 5% every year.
4,000
Prune your portfolio by getting rid of new-age
12,25,000 0 stocks that are losing money.
0
Consider closing down long-term policies that will
Assumptions used
NA 11,000 end 50-60 years from now. 6,000
in the calculations
Start SIP of `10,000 in this flexicap fund. Increase
0 0 amount by 5% every year. 10,000 INFLATION
Continue SIPs in this low-cost scheme. Increase by Education For all
29,552 2,000 2,000 expenses
5% every year. other goals
Continue investing contributions to these schemes.
19,73,805 16,000 Increase contributions by 5% every year. 16,000
, The goals can be reached using the mutual
10% 7%
`47,17,518 `53,000 funds marked in the same colour. `73,500
RETURNS
Equity funds Debt options

Increase SIPs to reach ambitious goals 12% 8%

Ashwani Mittal is saving for his child’s goals and retirement. Here’s what the doctor has advised:
1 2 3
CHILD’S COLLEGE CHILD’S MARRIAGE: RETIREMENT INCOME: 25 years
PORTFOLIO PORTFOLIOS
CHECK-UP ANALYSED BY
GOALS

EDUCATION: 22 years 25 years

PRESENT COST: `1.25 crore RAJ KHOSLA,
PRESENT COST: `25 lakh PRESENT COST: `20 lakh (`50,000 a month) Investing in equity Managing Director
FUTURE COST: `2.04 crore FUTURE COST: `1.08 crore funds for past 2-3 and Founder,
FUTURE COST: `6.78 crore
years. MyMoneyMantra
AMOUNT EXISTING Low SIP amounts so
FUND NAME RECOMMENDED ACTION
INVESTED (`) SIP (`) corpus is not very
Axis Bluechip 1,24,000 3,000 large. WRITE
Mirae Asset Large Cap 63,000 3,000
All four equity funds have performed well and hold promise. Buy a term plan of TO US
1
Axis Small Cap 10,850 2,000
Together they give a comprehensive exposure to different
segments of the market. Continue SIPs in these schemes and hike `1 crore to cover FOR HELP
the amount by 5% every year. these goals. If you want your portfolio examined,
Mirae Asset Tax Saver 21,000 2,000 Review mutual fund write to etwealth@timesgroup.com
with “Portfolio Doctor” as the subject.
portfolio at least
SBI Small Cap 22,000 2,000 Continue SIPs in this stable fund. Hike by 5% every year. Mention the following information:
2 once a year. Change
Parag Parikh Flexicap 0 0 Start SIPs of `2,000 in this outperformer. Hike by 5% every year. z Names of the funds you hold.
if any fund’s perfor- z Current value of the investment.
Canara Robeco Emerging Equities 18,450 2,000 Increase SIPs to `5,000 in this fund; hike by 5% every year. mance slips. z If you have SIPs running in any
Reduce risk when of them.
3 Provident Fund and PPF 12,75,000 24,100 Continue contributing and do not withdraw before retirement. z The financial goals for which you
goal is near so that invested.
Keep contributing to this low-cost scheme. Increase amount by
NPS 48,000 5,000 5% every year.
you don’t miss the z How much you need for each
target. financial goal.
z How far away is each goal.
TOTAL `15,82,300 `43,100
 your feedback & more...
22 The Economic Times Wealth August 1-7, 2022

Readers’ response, online and in print, to ET Wealth stories has been enlightening.
We pick some that add information and perspective to our articles from previous issues.

This refers to the column, ‘Why that corpus. While there is no panacea for all
coveted crore may not be enough’. these maladies and one size does not fit
The story presumes that the rupee
will be depreciating forever at the Good analysis of all, proper asset allocation and
calibrated amount of investment in
present rate of inflation. The future
is not always linear. We may end up in investment options equity and equity-based instruments
would go some way to help them.
economic depression induced by rich B. P. Sarkar
countries or advanced technologies The cover story, ‘Stop losing money
and the scenario may be completely to inflation’, has come up with With interest rates coming down and
different. some wonderful insights. It has not inflation going up, everyone except
Rakesh Prasad only highlighted the gaps in our those with government pensions
investments but has also presented a will die of penury. Only government
I have been wanting to write my good analysis of investment options servants with their pensions can lead a
feedback on the articles that appear in for readers to fill those gaps, given the life of luxury in their retirement years.
ET Wealth for years. Undoubtedly, ET current market scenario. Vijay Govind
Wealth is my favourite newspaper. I’m Sidhant M.
a CA and love to study and read about I have been reading ET Wealth for about
finance – especially personal finance. a couple of years now and think it’s
I really appreciate the two articles in amongst the best of publications for
this issue that touch upon two really The article, ‘Seeing retirement in new unfortunately sidelined the real issue—the investors. Uma Shashikant and
important topics, investment and light’, was quite relatable for me. The ordeal of an average retiree, particularly of Dhirendra Kumar do not falter any week
retirement. The manner in which both author has touched upon all the aspects a non-pensioner. Problems of these people in keeping readers engaged. Uma is an
authors have expressed their views very well. However, I recovered from the are three-fold, prolonged post-retirement absolute gem and her article for this
is very simple and can be understood mundane routine within a few months of life with poor health and accompanying week has prompted this response.
by even a layman. I hope ET Wealth after my VRS. Thank you for this article! progressive medical and general Kudos! Even ‘Your queries’ segment has
continues to publish such articles in the Anagha Khedkar expenditure, poor return of fixed income a very competent set of experts sharing
future as well. instruments, and the demon of inflation their wisdom.
Neeraja Kulkarni Uma Shashikant in her article has eroding the real value of retirement Imtiaz Shroff

REALTY Developing suburb in Bengaluru

This well connected locality boasts several residential projects by well known builders.
HOT SPOT
LOCALITY SNAPSHOT Supply by BHK
58%

KANAKAPURA ROAD, BENGALURU 40%

Kanakapura Road is a developing residential and commercial suburb in south-west Bengaluru.

Connectivity provided by Kanakapura Road, NICE Ring Road, Green line metro and BMTC local bus network.
2%
It has several multistorey residential projects by popular developers like Godrej, Prestige, Brigade and Total Environment.
Employment hubs: Kalyani Magnum, Brigade Software Park, Electronic City, Jigani Industrial Area and Bidadi Industrial Area. 1 BHK 2 BHK 3 BHK

Hospitals: Cura, Astra; Schools: Delhi Public, Alpine Public; Retail: The Arcade at Brigade Meadows and Vega City. Consumer preference
by budget (`)
PRICE RANGE: `4,300-9,800/- psf DISTANCES: Kempegowda Intl. Airport : 48 km KSR Railway Station: 13 km NH-948: 0 km
17% 12%
Doddakallasandra Below 50 lakh
1 BHK
Price (`/sqft): 6,500-9,800 50-75 lakh
650 (sqft) Brigade 12% 29% 75 lakh-1 crore
`40
Software
*Rent (`/month): 19,000-35,000
NH-48

Park
1-1.25 crore
lakh (avg)
Kalyani
30% Above 1.25 crore
Uttarahalli
Magnum
Gubbalala
Subramanyapura Price (`/sqft): 4,300-6,900
Ho
su

Gubbalala
5

2 BHK Bengaluru *Rent (`/month):16,000-25,000

rR
-27

Consumer preference
oa

Doddakallasandra
NH

1,200 (sqft)
d

by saleable area (sqft)

`77
lakh (avg)
NH-48
Electronic City
Subramanyapura
Price (`/sqft): 5,000-7,500 9%
Ba
nn Jigani Industrial
*Rent (`/month):18,000-35,000 14%
Kanakapura Road er
gh Area Below 1,000
at
ad ra

ta
An 1,000-1,250
Ro kapu

3 BHK ek Uttarahalli 27%

al
Ro 20% 1,250-1500
na

1,600 (sqft) ad
Price (`/sqft): 4,800-7,300
Ka

1.02
`crore
1,500-1,750
*Rent (`/month):15,000-32,000 30% Above 1,750
(avg)
Note: Map not to scale *3 BHK Rent (INR/month)

Schools 15+ Hospitals 10+ Restaurants 15+ Banks 15+ Grocery Stores 15+ Petrol Pumps 10+ In dia’s No. 1 P ropert y Sit e

The Economic Times Wealth is available at an invitation price of `8/issue. To book your copy, contact your newspaper vendor or call 011 - 39898090; Email: crm.delhi@timesgroup.com; SMS ETWS to 58888

The Economic Times Wealth, published by Bennett, Coleman & Co. Ltd. exercises due care and caution in collecting the data before publication. In spite of
this, if any omission, inaccuracy or printing errors occur with regard to the data contained in this newspaper, The Economic Times Wealth will not be held
responsible or liable. The content hereof does not constitute any form of advice, recommendation or arrangement by the newspaper. The Economic Times
Wealth will not be liable for any direct or indirect losses caused because of readers’ reliance on the same in making any specific or other decisions. Readers
are recommended to make appropriate enquiries and seek appropriate advice before making any specific or other decisions.
PUBLISHED FOR THE PROPRIETORS, Bennett, Coleman & Co. Ltd. by Rajeev Yadav at Times House, 7, Bahadur Shah Zafar Marg, New Delhi-110 002,
Phone: 011-23322000, Fax: 011-23323346 and printed by him at The Times of India Press, 13 & 15/1, Site IV, Industrial Area, Sahibabad, UP. Regd.
Office: Dr Dadabhai Naoroji Road, Mumbai 400 001. EDITOR: Babar Zaidi (Responsible for selection of news under PRB Act). © Reproduction in
whole or in part without written permission of the publisher is prohibited. All rights reserved.
RNI NO. DELENG/2011/37994. MADE IN NEW DELHI VOLUME 12 NO. 31
THE ECONOMIC TIMES
WILL FIIS COME
BACK? (AND WHEN?)
www.etwealth.co | Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, New Delhi, Pune | August 1-7, 2022 | 24 pages | `8
P2
guest column
The Economic Times Wealth August 1-7, 2022

Why you can’t throw

caution to the winds
Equity investors are always optimistic by nature, but they need to keep their
enthusiasm in check to avoid losing money, says Dhirendra Kumar.

T
o put my readers in the right
frame of mind for this article,
I’ll quote a quip from Warren
DHIRENDR A KUMAR
CEO, VALUE RESE ARCH Buffett’s deputy Charlie Munger,
whom someone has described as

money the richest comedian in the world, “Warren,

if people weren’t wrong so often, we

mysteries wouldn’t be so rich.” The takeaway obvious-

If you are doing your
own research and
investing in smaller
companies then you
need to know how to
look after yourself.
In larger companies,
people misjudge the
business and the
valuations.
ly being that when some people are wrong,
others get rich at their expense.
I know you dislike negative stories—eve-
ryone does. However, understanding this
dislike and overcoming it is important in
becoming a successful investor. And what
exactly do I mean by a negative story? Over
the last two decades, writing in various
publications as well as on Value Research
Online, I have observed that negative arti-
cles are not popular. A negative article, or
even just a piece of advice, explains to you
what is bad and what not to do. A positive
one tells you what is good and explains what
you should do. A positive article is about
how investors should make money. A nega-
tive one is about how investors should avoid
losing money.

People invest in equity to

make money. However,
the reality is that it’s just
as important to avoid
losing money.
GETTYIMAGES

In my opinion and observations, the dif-

ference in attitude arises from the fact that
equity investors are inherently optimistic.
We don’t like to think about how not to lose
money. You might think that equity invest-
ing makes people optimists, but that’s not
really true. The cause and effect are the
other way around. Only people who are
inherent optimists tend to become equity
investors. To start investing in equities (or
equity based mutual funds, which is the
same thing in this sense), you need to have
a strong, inherent belief that tomorrow will
be better than today. Everything else comes
later. People invest in equity to make money,
not to avoid losing it. However, the reality
of equity investing is that it’s just as impor-
tant—or perhaps more important—to avoid
losing money.
One of the problems of equity investing is
that there are people who are actively try-
ing to get you to do the wrong thing in order
to get rich at your expense. At the heart of
equity investing is the investors’ ability
to trust the information and the numbers
that companies release about their busi-
ness. Without this trust there is nothing.
Historically, till at least the 1990s, it was
pretty hard to trust such numbers. In fact,
stock prices had what could be called a trust
premium or discount. For example, there
was an MNC premium, which was mostly
because you could trust the numbers. There
was also a so-called south premium, al-
though that dates further back than the 90s.
Investors believed that South Indian pro-
moters were less likely to fudge numbers.
There were also premiums or discounts for
other ethnic or regional communities but
let’s not discuss that. At the end of the day,
the stock markets did not trust the data that
was released. Physical verification was an
integral part of stock research and it was
common that a business that looked good on
paper was a different story in reality.
Today, for large parts of the equity mar-
kets, the situation is quite different. For
at least the 100 to 200 largest companies,
you can by and large trust the financial
numbers. A lot of regulatory reforms of dif-
ferent kind have made a difference, includ-
ing those in auditing as well as the web of
information created under GST. Moreover,
companies beyond a certain size, the atten-
tion of a large number of investors as well
as analysts should mean that anomalies are
relatively easy to detect. However, if you are
doing your own research and investing in
smaller companies then you need to know
how to look after yourself. In larger compa-
nies, people misjudge the business and the
valuations.
Make no mistake, the accounting and
tax systems reforms have cleaned up eve-
rything on a relative scale. Still, in smaller
companies there is a higher incidence of get-
ting dodgy numbers and it’s the investors
themselves who have to have the forensic
skills to guard against it. That, and a sharp
self-control on their tendency to let their
optimism ride roughshod over their innate
caution!
Please send your feedback to
etwealth@timesgroup.com