Fund Manager Interview
Mr. Amit Ganatra
Head of Equities, Invesco Mutual fund
Amit Ganatra is a highly accomplished financial professional renowned for his expertise in equity fund management and investment strategy. With over two decades of experience in the investment industry, Mr. Ganatra currently serves as the Head of Equities at Invesco Asset Management, where he leads a team of investment professionals and oversees the management of equity portfolios.
Throughout his career, Mr. Ganatra has demonstrated a remarkable ability to navigate complex market environments and deliver strong investment performance for clients. His strategic vision and deep understanding of market dynamics have earned him a reputation as a trusted leader in the field. Prior to his role at Invesco, Mr. Ganatra held senior positions at leading financial institutions, including Invesco Asset Management (India) Private Limited, DBS Chola Asset Management, Fidelity Investments, and CMIE.
In these roles, he played a pivotal role in shaping investment strategies, managing diverse portfolios, and driving business growth. Mr. Ganatra holds a C.F.A. in finance from the AIMR US, further underscoring his commitment to professional excellence and continuous learning in the financial domain. With his wealth of experience and proven track record of success, Mr. Ganatra continues to be a driving force in the investment industry, delivering value to clients and stakeholders alike.
Answer : We continue to remain sanguine on the arbitrage spreads. Reasons being:
1.Retail/ HNIs continue to remain long on stock futures. Also, midcaps/ small caps have performed superbly inspite of the large cap performance being muted in Aug. Retail/ HNIs generally tend to pay higher roll spreads and more so when they are sitting on profits which is visible from the performance of non-Nifty names in the last few months.
2. Mfs as %age of total open Interest is still at the lower end of the historical range. When this percentage increases, arbitrage funds tend to fight amongst themselves, thereby putting pressure on the spreads. As of Aug end, this %age was only 49% on August 30, whereas the range has been 45% to 65% in the last 2 years.
However, one should keep a watch on the corpus of the industry. If that continues to balloon, spreads will get impacted adversely in the future.
Answer : Small Cap’s and midcap’s valuations had become attractive by March 2023 – as the set had undergone some time as well as price correction in FY2023. Also, earnings growth in India continues to be broad-based ensuring participation of a broader universe in the earnings growth. This twin aspect of continued earnings growth support and attractive starting valuations attracted large flows to the category, which in turn led to a sharp rally from lows.
Answer : In most of the funds, midcap and small exposure was increased in March and April due to the factors explained above. Otherwise, most of the other changes are specific to the mandates of the fund.
Answer : Space Industry is part of the overall Industrials space and most of our portfolios are already overweight Industrials for the last couple of years. Hence, no incremental changes were required on account of this event.
Answer : Outperforming the benchmarks on a consistent basis is becoming difficult, specially in Large Cap space and hence, passive funds especially in large cap categories are attracting flows. However, passive investing also has its own perils and one should respect asset allocation as well as have a blend of active and passive to achieve long-term journey of wealth creation.
Answer : India is experiencing a strong broad-based earnings recovery largely due to the confluence of the following factors, and each of them are important themes for future:
1. Strong balance sheets of Corporate India and the Banking sector is driving willing as well ability to borrow and lend – thereby driving credit upcycle in the country.
2. Market share gains of organised versus unorganised in various sectors – especially in consumer space are driving strong outcomes for the listed universe at the expense of unorganised.
3. Capex by the Manufacturing sector for export opportunities and import substitution is leading to revival of private sector capex in the country.