Akshay Gupta , MD & CEO, Peerless Fund Management Company Ltd. has been in the Indian Capital Markets and Banking industry for over 12 years with varied experience in Sales, Marketing, Products, Operations and Fund Management. He has worked as a CEO for Global Portfolio Advisors, a leading global wealth management company. He has also worked with ICICI Prudential Mutual Fund. During his association with ICICI Prudential MF, he was Head - Sales and Distribution and being part of the key senior management team, he was responsible for taking the AMC to great heights. He has also worked as the Product Head for Capital Markets with ABN AMRO Bank handling Mutual Funds, IPOs, Loans against Shares, Forex and Trade Finance products. He has gained experience in the equity markets by working as a President for IndiaBulls, where he was responsible for the online trading business.
Peerless Mutual Fund is sponsored by The Peerless General Finance India Co Ltd, a diversified business group with mainstay in Financial Services. The company has launched its Asset management business in the month of February. Recently they have launched two Products Liquid and Ultra Short Term funds catering to Institutional needs. The Company also plans to launch a Savings fund for retail customers. The company has created its own presence in around 30 locations to start with having primary focus on Tier II and Tier III locations. The company will be creating a mark on its launch with first mutual fund making its presence in many Tier III locations.
Replying to Yash Ved of IIFL, Akshay Gupta says, "Retail investors should go in for hybrid plans, which have a mix of both debt and equity."
What is your view on the Indian stock market?
The long term growth story of India remains intact and thus makes Indian markets attractive with a three to five year view. However, current valuations capture the growth to some extent.
Do you expect another CRR and rate hike over coming months?
With Inflation showing no signs of abating immediately, another round of rate hikes should follow. We expect rates to harden gradually by another 50bps this fiscal. Since liquidity is already tight, we may not see a CRR hike.
What is your view on the rupee?
A broad-based economic recovery and strong foreign flows is keeping rupee relatively strong. We expect $ Rupee to be in the range of 45 to 48 in the near term (1-3 months) and 42 to 48 in the long term (> 3 months).
What is your GDP growth forecast for FY11?
We expect current year GDP to grow between 8.25-8.50%.
What are the regulatory issues, which need to be improved to make the Mutual Fund industry better?
There have already been many regulatory changes for protecting the interest of the investors and improving transparency / disclosure in the MF industry.
Which are the sectors you are bullish and bearish?
We are bullish about the long term growth story of India and thus would prefer sectors which would contribute to this growth. They include Banking, Capital Goods and Infrastructure. We also like domestic consumption themes including Automobiles and non-domestic sectors like Technology. At current levels, we would avoid Commodity and Telecom sectors.
Brief us about your equity and Debt schemes? Any new NFO in the near term?
Presently, we have two open-ended short term debt / money market schemes, which are in the Liquid / Ultra Short Term funds space. Presently, the AUM in these schemes is over Rs 15bn (as on July 31, 2010). We have also launched an Income Plus Fund in the conservative, actively managed MIP category. We are in the process of applying to SEBI for a few more products and in due-course, we shall be able to disclose the same.
What are some of the challenges being faced by mutual funds?
Presently the challenges that are being faced by the industry are investor-confusion and poor penetration. Despite MFs being the most cost-effective and transparent investment product, industry has not been able to penetrate as effectively as the other financial manufacturing industries. With commissions coming down, it is being observed that most advisors are not recommending MF products with the same passion as before. Too many offerings by different Asset Management Companies are also confusing the investors.
What is your advice to retail investors?
When markets are at higher levels, there is a possibility of volatility. In such a scenario, selecting a particular asset class becomes difficult. Thus, Retail Investors can go for hybrid plans which have a mix of both debt and equity. They should preferably opt for a SIP (Systematic Investment Plan). SIP helps in making a fixed sum of investments at regular intervals and thus get the benefits of rupee cost averaging. The real advantage comes when continued over a long period of time as it avoids the need of timing the market.