Sundaram Services Fund has performed impressively sinceinception, beating its benchmark (Nifty Services index) and Nifty 500 TRI over1 and 3 yr timeframes. Rohit says allocations in the BFSI space and selectservice industry stocks in QSR and travel helped drive performance.
The “manufacturing will outperform services this decade”narrative often looks only at service-exports. Domestic services have a strongcorrelation with manufacturing growth and will therefore benefit meaningfullyfrom a boom in manufacturing.
While 90% of the benchmark index is made up of only BFSI andIT, the fund has a much more broad-based holding across many other servicessectors including restaurants, online platforms, logistics, hospitals,media/entertainment etc.
While lending margins may have peaked for banks, creditexpansion will ensure growth momentum and higher fee income can add to profits.Rohit is very bullish across the BFSI space.
Rohit is cautious on IT but is very optimistic on mediacompanies especially after their sharp correction. He also likes telecom andQSR spaces.