Indian fund managers expect shares to move up but only marginally, making them averse to raising equity exposure in the next three months, a Reuters poll of 10 domestic fund houses showed on Friday.
Four of them expect shares to rise up to 5 percent, two managers see shares rising up to 10 percent and one bet on a rise of more than 10 percent. Fund managers said they expect shares to consolidate with a marginal rise rather than show a sharp upmove.
"We are not increasing exposure to equity. I will increase exposure in mid-cap and reduce in large-cap and thereby seek alpha," Jayesh Shroff, fund manager at SBI Mutual Fund said.
Alpha is the excess return over the benchmark fixed by the fund.
India's benchmark stock index which is trading at a 19 times forward earnings ended flat in October at 20,032.34 points. The 30-share index is still up 14.7 percent year to date, as foreign funds have invested a net $24.7 billion in Indian primary and secondary equities in the period. About half of the fund managers polled plan to increase exposure to mid-caps, while decreasing in small cap and large-cap stocks.
Engineering tops buy chart
Six money managers said they would increase exposure to engineering stocks as they were positive on the back of the Indian growth story.
"Engineering has not performed very well this year for couple of reasons like they due they were low on returns...if this underperformance was to be bridged over next three months then this trade should play out," said Amit Nigam, senior fund manager at BNP Paribas Mutual Fund .
India's economy is seen growing by 8.5-9.7 percent in the 2010/11 fiscal year, according to a report released by the finance ministry. The International Monetary Fund projects growth at 9.7 percent for calendar 2010.
Fund managers are also betting on the spending in the engineering and construction sector which is likely to accelerate due to backlog in the 11th Five Year Plan.
Indian fund managers said they see the stocks fairly valued at the current levels.
Source: http://economictimes.indiatimes.com/markets/analysis/Fund-managers-see-marginal-stocks-rise-eye-engineering-stocks/articleshow/6835911.cms
Four of them expect shares to rise up to 5 percent, two managers see shares rising up to 10 percent and one bet on a rise of more than 10 percent. Fund managers said they expect shares to consolidate with a marginal rise rather than show a sharp upmove.
"We are not increasing exposure to equity. I will increase exposure in mid-cap and reduce in large-cap and thereby seek alpha," Jayesh Shroff, fund manager at SBI Mutual Fund said.
Alpha is the excess return over the benchmark fixed by the fund.
India's benchmark stock index which is trading at a 19 times forward earnings ended flat in October at 20,032.34 points. The 30-share index is still up 14.7 percent year to date, as foreign funds have invested a net $24.7 billion in Indian primary and secondary equities in the period. About half of the fund managers polled plan to increase exposure to mid-caps, while decreasing in small cap and large-cap stocks.
Engineering tops buy chart
Six money managers said they would increase exposure to engineering stocks as they were positive on the back of the Indian growth story.
"Engineering has not performed very well this year for couple of reasons like they due they were low on returns...if this underperformance was to be bridged over next three months then this trade should play out," said Amit Nigam, senior fund manager at BNP Paribas Mutual Fund .
India's economy is seen growing by 8.5-9.7 percent in the 2010/11 fiscal year, according to a report released by the finance ministry. The International Monetary Fund projects growth at 9.7 percent for calendar 2010.
Fund managers are also betting on the spending in the engineering and construction sector which is likely to accelerate due to backlog in the 11th Five Year Plan.
Indian fund managers said they see the stocks fairly valued at the current levels.
Source: http://economictimes.indiatimes.com/markets/analysis/Fund-managers-see-marginal-stocks-rise-eye-engineering-stocks/articleshow/6835911.cms
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