Mahindra Manulife Flexicap Fund has delivered a strong top quartile performance over the last 12 months, driven by stocks picks in industrials, financials and consumer discretionary sectors. Nimble bottom upmoves within these sectors drove most of the outperformance, rather than the sector calls themselves – given that most peers were anyway overweight these sectors.
Contrary to the growing trend of fund managers shifting from big banks to NBFCs in anticipation of a declining rate cycle, Fatima has added back her positions in banks keeping the current global and domestic “higher-for-longer” environment in mind.
The fund has increased its small cap exposure from 10% to17% to capitalize on opportunities in this space.
Fatema is bullish on small niches including engineering management services (EMS), textiles (she thinks this can become the next chemicals story for India), real estate (particularly residential real estate),power utilities, railways and consumer durables. While the market is focused on India plays, Fatema sees strong prospects in underowned global themes including IT services, chemicals and textiles. Likewise, within domestic themes, she looks at spaces that are growing well yet remaining relatively underowned –like residential real estate companies and power distribution companies.