Franklin Templeton expects the Indian economy to be among the first to recover from the global slump and sees top names such as Reliance Industries and Bharti Airtel emerging as winners, spurred by a growing local market.
On Tuesday, the U.S. fund manager's $335 million Franklin India Fund was ranked the top performing India fund by Lipper over the past three years among mutual funds available in Singapore.
The fund has been raising its holdings of India's best-known firms even in out-of-favour sectors, chief investment officer for Indian equities Sukumar Rajah told Reuters in an interview.
"From a fundamental perspective, India with its relatively lower dependence on exports is likely to weather the current global uncertainty better. This is further supported by the robust banking system and strong domestic consumption."
Infosys Technologies, the country's second largest software exporter, HDFC Bank, the second largest private sector lender, and consumer goods firm Nestle India are the fund's other top holdings.
India's economy is expected to grow by 5.1 percent this year compared with 7.3 percent in 2008, according to forecasts by the International Monetary Fund. .
The world's second most populous nation ranks after China and Hong Kong in terms of investment appeal, according to a Thomson Reuters survey of portfolio managers and securities analysts who together help manage more than $1 trillion in assets.
The Franklin India fund lost 1.2 percent in dollar terms in the 36 months to January 2009 compared with a 5.6 percent fall in the MSCI India index, according to the fund's factsheet.
LOCAL GROWTH
Rajah said countries that rely on domestic demand and are growing at a relatively fast pace had a better chance of attracting new capital over the longer term, giving a boost to the economy and stocks.
The BSE Sensex tumbled by more than half in 2008, its worst annual performance ever, and has shed a further 8 percent so far this year.
Rajah said Templeton had increased its investment in Reliance to 7.8 percent of the India fund's portfolio at end-January from 5.5 percent in September because the firm's diverse oil and gas exploration, production, and petrochemical businesses helped it overcome the volatile product cycles in energy markets.
"The large oil and gas exploration acreage coupled with the company's scale and capabilities to execute projects provides opportunities for further growth," he added.
As for Bharti, Rajah said the Indian mobile market could see 2-3 more years of aggressive growth before maturing and market leader Bharti had "consistently expanded market-share by leveraging its branding, better execution and infrastructure capabilities."
"We believe well-managed Indian companies will emerge stronger in the current environment, and the sharp declines have resulted in attractive valuations across sectors."
On Tuesday, the U.S. fund manager's $335 million Franklin India Fund was ranked the top performing India fund by Lipper over the past three years among mutual funds available in Singapore.
The fund has been raising its holdings of India's best-known firms even in out-of-favour sectors, chief investment officer for Indian equities Sukumar Rajah told Reuters in an interview.
"From a fundamental perspective, India with its relatively lower dependence on exports is likely to weather the current global uncertainty better. This is further supported by the robust banking system and strong domestic consumption."
Infosys Technologies, the country's second largest software exporter, HDFC Bank, the second largest private sector lender, and consumer goods firm Nestle India are the fund's other top holdings.
India's economy is expected to grow by 5.1 percent this year compared with 7.3 percent in 2008, according to forecasts by the International Monetary Fund. .
The world's second most populous nation ranks after China and Hong Kong in terms of investment appeal, according to a Thomson Reuters survey of portfolio managers and securities analysts who together help manage more than $1 trillion in assets.
The Franklin India fund lost 1.2 percent in dollar terms in the 36 months to January 2009 compared with a 5.6 percent fall in the MSCI India index, according to the fund's factsheet.
LOCAL GROWTH
Rajah said countries that rely on domestic demand and are growing at a relatively fast pace had a better chance of attracting new capital over the longer term, giving a boost to the economy and stocks.
The BSE Sensex tumbled by more than half in 2008, its worst annual performance ever, and has shed a further 8 percent so far this year.
Rajah said Templeton had increased its investment in Reliance to 7.8 percent of the India fund's portfolio at end-January from 5.5 percent in September because the firm's diverse oil and gas exploration, production, and petrochemical businesses helped it overcome the volatile product cycles in energy markets.
"The large oil and gas exploration acreage coupled with the company's scale and capabilities to execute projects provides opportunities for further growth," he added.
As for Bharti, Rajah said the Indian mobile market could see 2-3 more years of aggressive growth before maturing and market leader Bharti had "consistently expanded market-share by leveraging its branding, better execution and infrastructure capabilities."
"We believe well-managed Indian companies will emerge stronger in the current environment, and the sharp declines have resulted in attractive valuations across sectors."
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