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geojit financial: ETMarkets Fund Manager Talk: Structural trend of SIPs strong, set to grow further: K Dileep, Geojit Financial

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With the growing awareness of financial assets, Systematic Investment Plans (SIPs) have gained traction and the trend is expected to continue with the growth rate increasing further, K Dileep, Head of PMS at , said in an interview. with ETMarkets.

Having started his career with

23 years ago, Dileep’s main responsibility is to build and manage its clients’ portfolios.

Edited excerpts:

Tell us about you? How did you fall in love with stocks – what was the turning point?

I started my career at Geojit Financial in 1999 after completing my business degree. From the beginning, I followed the stock market very closely and followed its trends.

I used to watch investment stories and read investment experiences of knowledgeable investors and fund managers. My thirst for knowledge about the market created a passion for stocks. Since 2010, I have been a portfolio manager for Geojit.

How many AUMs do you manage and how has the fund performed so far in 2022?

We manage close to Rs 500 crore. Our portfolios performed very well in 2022, especially the Advantage portfolio. In September 2022, the one-year return of our Advantage Portfolio is 11.4% compared to Nifty

Midcap 100, its benchmark index shows returns of 0.90%.

2022 is slowly turning into a roller coaster for investors as well as fund managers with too many variables impacting the Indian market. How do you manage the volatility of your fund?

Volatility is part of fund management. When we see a long-term return of 15% CAGR, volatility (especially on the downside) is a boon, and we would like to add stocks at lower levels to improve long-term returns. We saw volatility during the Lehman crisis, the PIGS crisis, COVID, and all of that ultimately led to higher returns if we invested during the crisis.

Why do FIIs sell the best performing market? India stands out among the emerging market pack, but still faces exits. When will the trend reverse?

Even though we are the best-performing market, FII risk appetite should decline when the US Fed raises interest rates. Therefore, they are likely to reduce their risk exposure in emerging markets. The trend will reverse as soon as the Fed signals that the interest rate has peaked or that inflation has peaked in the United States.

What level of cash are you at? Are you setting aside more cash to deploy later?

We held an average cash of 3% until last month, of which we deployed a third last week. Currently, we only hold 2% cash.

Where do you see markets in Samvat 2079?

This year will be industry and stock specific. The market could be neutral to positive in the first half, while in the second half it should be much better given that the Fed may stop raising rates.

Which sectors do you think could stay in the spotlight until the next Diwali?

The banking and pharmaceutical sectors are attractive.

What are your main holdings and have you reorganized your portfolio recently? A new entry or exit in your portfolio?

, , , are our main holdings. We didn’t exit any, but took profits in Tata Elxsi.

SIP contributions have only increased significantly in the past, which is a positive sign for the Indian markets. Do you see the trend continuing? A ballpark number you see by the end of FY23?

I see this as a structural trend, as young people today don’t want to lock their money into real estate or hard assets, as they prefer to move to a new city/country for better opportunities careers.

In addition, awareness of financial assets is increasing. Additionally, SIPs have delivered good long-term CAGR returns in the past.

Therefore, we see this trend continuing and, in fact, the growth rate is expected to increase further. I don’t want to settle for a ballpark number, but I’m directionally very positive.

(Disclaimer: The recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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