Axis Business Cycles Fund has got off to a strong start, posting over 20% returns in its first 7 months, beating BSE 500 TRI. Unlike other Axis equity funds, this one takes top down business cycle calls on different sectors with high active share denoting a benchmark agnostic approach.
Nimbleness to move across sectors depending on changing macro outlook results in a higher portfolio turnover than other Axis funds. Overlap with other Axis funds is less than 35%.
As we move from a rising to a declining interest rate environment, Ashish favours NBFCs over large banks (who he believes will face margin compression that won’t be fully offset by credit growth). Domestic cyclicals in the mid and small caps spaces should also do well in this environment.
Ashish is bullish on real estate, infrastructure, auto and industrials – where he sees sufficient near term as well as medium term triggers.
He believes that chemicals/speciality chemicals as well as global commodities including metals and sugar have bottomed out and now offer attractive investment opportunities.