Despite sideways markets over last 2 years, there are over 150 stocks that have delivered over 20% CAGR in this period. Rahul expects market breadth to gradually increase over next few quarters – but for now, it will likely be a stock picker’s market.
Bandhan Large & Midcap Fund continues to post top quartile performance across all time horizons from 1 yr to 10 yrs.
Rahul says the single biggest contributor to this outperformance is remaining cap agnostic and style agnostic, observing what the market is doing and saying, and moving nimbly to align with the market rhythm.
The other key performance driver is his basket approach to portfolio construction. He has identified 30+ baskets of stocks. When he gets bullish on a basket, he typically spreads bets across 3-4 names in the basket rather than a concentrated bet on only one.
This has resulted in a portfolio of over 120 stocks which may appear unwieldy – but in reality, it is around 30 baskets that he tracks. Spreading bets across a basket helps reduce concentration risk, which he believes is very important in a world that is becoming increasingly dynamic, disruptive and uncertain.
He is very positive on financials and has built sizeable positions in large banks which he says now represent a confluence of value and growth.
He is also bullish on insurance companies – especially general insurance plays, as they are coming out of a rough regulatory change driven patch and looking good for healthy growth going forward.
He is cautious on cement and building materials as the Government’s infra spend growth has started tapering.