Mr. Ved Prakash Chaturvedi, Managing Director, Tata Asset Management Ltd has worked with various leading financial services organisations in India. These include CRISIL (Indian business of Standard & Poors), Banque Nationale De Paris, SBI Funds Management. Mr. Chaturvedi has a Bachelor’s Degree in Electronics Engineering and an MBA from the Indian Institute of Management, Bangalore. Chaturvedi is also a Director on the Board of Association of Mutual Funds in India (AMFI), Member of the SEBI Advisory Committee of Mutual Funds, Member of the Capital Market Committee of the Indian Merchants’ Chamber (IMC) and a Committee Member of the Confederation of Indian Industry (CII) National Committee on Mutual Funds.Tata Mutual Fund manages around Rs202bn (average AUM for the month) as on September 30, 2009 worth of assets across its varied offerings. Tata Mutual Fund offers an investment option for everyone, whether you are a businessman or salaried professional, a retired person or housewife, an aggressive investor or a conservative capital builder.
Replying to Yash Ved of India Infoline, Ved Prakash Chaturvedi says, “Economic growth in many emerging markets has decoupled from the economic growth in developed markets.”
What is your view on the Indian stock markets ?
In our view an incipient recovery is under way in the Indian equity markets. However, there are apprehensions with respect to the deficient rainfall and with respect to the Chinese and global situation. On balance, global sentiment determines fund flows to emerging markets and to India and hence will continue to be a driver of market levels here.
Equity markets do not go up or down in a straight line. We have seen a very sharp run-up in our equity markets in the last few months. There will be possibly a period of consolidation and then based on the outlook for earnings growth from companies markets will move ahead.
Most analysts expect that fiscal year 2010-11 will be a year where we can expect EPS growth from companies as business confidence returns. If this scenario materializes, then we can expect some good cheer in Indian equity markets over this period.
What is your view on the Indian and global economy?
If evidence of the last 24 months is to be believed it does seem that economic growth in many emerging markets has decoupled from the economic growth in developed markets. In fact, for 2009 it seems that most of the global growth will actually come from emerging markets. However, it needs to be remembered that the largest pool of capital still lies with developed economies. Thus, investment flows into emerging markets continue to be driven by sentiments prevailing in developed markets. Thus, though economies have decoupled market movements still bear co-relation to developed market movements owing to the fact that sentiment there impacts fund flows and sentiment in emerging markets. This situation is likely to continue for some more time.
We cannot comment on the outlook for economic growth in developed markets as we do not track those markets proactively. However, our general view is that once the uncertainties of the global economy slowly fade away, business confidence and consumer confidence across the globe will slowly recover.
How do you see inflation and interest rates going ahead?
The coming few months will possibly see focus on inflation. It is a fact of life that when too much liquidity is injected into our system and money supply increases while the supply of goods and services do not increase proportionately it is a driver of inflation. It should also be kept in mind that since in our country inflation is measured on a year-on-year basis, the “base effect” will also cause headline numbers of inflation to start looking up as we go into 2010. The drought situation is also to be considered. Thus, inflationary expectations are likely to return in the next 18 months at some point of time.
How much schemes are you currently dealing with?
We currently have a range of 38 investment schemes – 20 Equity schemes, 14 Debt & Cash schemes and 4 Balanced or Hybrid schemes.
What is your view rupee on the rupee?
Over the long period of time, the rupee and emerging market currency should strengthen against the US dollar. But in short time frame, things will be more volatile.
Which of the sectors you are bullish?
We are positive on infrastructure, construction, engineering and capital goods.
Your message to the retail investors?
Our message is that long term story in India is very good as growth rates are likely to continue. Investors should understand risk appetite and carefully invest so as to benefit to growth of Indian economy.
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