HSBC Midcap Fund as well as HSBC Large & Midcap Fund– both managed by Cheenu Gupta – continue to post top decile performances despite a challenging market.
Cheenu’s portfolio strategy is what’s driving this continued outperformance:
1. Continue to build certainty into the portfolio in a highly uncertain world. Pick stocks that are relatively immune to global macro uncertainties and which focus on tapping growing domestic demand in specific niches.
2. Avoid hope trades that look attractive on solely on beaten down valuations. Look for change in fundamentals in such cases, else stay away.
3. Identify managements who demonstrate clarity of purpose and strategy and consistency in execution.
4. Focus on exits as much as one focuses on stock selection and entry points. Stay open minded and nimble, always re-evaluate your thesis to test for ongoing relevance.
She warned us back in April not to build too much hope on a bull market until oil prices actually settle down sustainably. Her call was right – markets are now back to March 2026 levels and oil prices are back above$100.
She believes its too early even now to expect a sizeable broad based bull market to take shape. Niche pockets of domestic focused opportunities is what she continues to focus on.
She has taken sizeable tactical positions in large banks– which she was avoiding until recently – as they will likely be the biggest beneficiaries in a rate hiking cycle which has just begun.
She has started cherry picking in the IT services space – now that she is getting some clarity on business models that appear more robust than others amidst AI disruption.
She has also taken a contrarian call by picking some generic exports focused pharma companies – which have seen material de-rating in valuations amidst drug pipelines that are building up nicely.