Despite fears that the budget may not live up to expectations and even act as a dampener for the Indian stock markets, mutual fund managers seem unperturbed and are going about investing in the usual way. Most have already taken a bottom-up approach in view of the government’s reformist approach from a long term perspective.
“Our investment decision will not be guided by any speculation on budget outcome. Rather, we repose faith in UPA-government’s economic policy approach on 5-year term basis. We cannot expect them to execute full reform process in a single budget, whatsoever may be the expectation level,” said N K Garg, CEO, Sahara Mutual Fund.
Fund houses are already overweight in sectors like power and infrastructure post elections, and such sectoral bias is unlikely to change unless the government makes some major policy announcements.
When the world economy is going through tough times, the combination of an economist Prime Minister Dr Manmohan Singh, an astute politician Pranab Mukherjee as finance minister and a technocrat deputy commissioner of Planning Commission Montek Singh make a strong case for sustainable long term growth, fund managers believe.
“Our investment decision will not be guided by any speculation on budget outcome. Rather, we repose faith in UPA-government’s economic policy approach on 5-year term basis. We cannot expect them to execute full reform process in a single budget, whatsoever may be the expectation level,” said N K Garg, CEO, Sahara Mutual Fund.
Fund houses are already overweight in sectors like power and infrastructure post elections, and such sectoral bias is unlikely to change unless the government makes some major policy announcements.
When the world economy is going through tough times, the combination of an economist Prime Minister Dr Manmohan Singh, an astute politician Pranab Mukherjee as finance minister and a technocrat deputy commissioner of Planning Commission Montek Singh make a strong case for sustainable long term growth, fund managers believe.
Instead of changing investment strategy, MFs are keeping an eye on the budget for government’s future policy directions, which will help them take long term investment decisions.
“Budget should enable availability of cheap funds to all types of companies. Borrowing is still a costly affair. It will help companies grow faster. Further, economy needs allotment of funds for infrastructure projects,” pointed out Ved Prakash Chaturvedi, managing director, Tata Asset Management.
Navneet Munot, chief investment officer, SBI Mutual Fund, said: “Striking a balance between stimulus economic package to fuel economy and rising fiscal deficit should be the biggest task of this new government’s first budget that is going to be a signal for government’s reformist intensions in the next 5 years.”
“Budget should enable availability of cheap funds to all types of companies. Borrowing is still a costly affair. It will help companies grow faster. Further, economy needs allotment of funds for infrastructure projects,” pointed out Ved Prakash Chaturvedi, managing director, Tata Asset Management.
Navneet Munot, chief investment officer, SBI Mutual Fund, said: “Striking a balance between stimulus economic package to fuel economy and rising fiscal deficit should be the biggest task of this new government’s first budget that is going to be a signal for government’s reformist intensions in the next 5 years.”
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