EQUITY MODEL PORTFOLIOOur indicative large-cap equity model portfolio is delivering an impressive
return (inclusive of dividends) of 163.39% till date (as on May 31, 2019) since its
inception (June 21, 2011) vis-à-vis the benchmark index (S&P BSE Sensex)
return of 125.99% during the same period, an outperformance of 37.4. This
validates our thesis of selecting companies with sound business fundamentals
that forms the core theme of our portfolio. We have revised stocks in our
midcap portfolio. It continues to outperform, delivering 273.56% (inclusive of
dividends) till date (as on May 31, 2019) vis-à-vis the benchmark index (CNX
Midcap) return of 132.26%, an outperformance of 141.3. Our consistent
outperformance demonstrates our superior stock picking ability as markets
aligned to our view of favourable risk reward, good franchisee vs. reward-at-
any-risk businesses.
We have always suggested the SIP mode of investment and still find a lot of
merit in it as the preferred mode of deployment given the market conditions
and volatility associated since the inception of the portfolio. We highlight that
the SIP return of our portfolio has consistently outperformed the indices.
Following the same pace and opportunities in the market, our latest portfolio
(large caps) remains overweight on BFSI sector – HDFC Bank (10%), HDFC
Limited (9%), Axis Bank (6%) Bajaj Finance (6%) and SBI (6%). Tech Mahindra
Limited is the latest addition to the large-cap portfolio, given 6% weightage.
Maruti Suzuki and EICHER Motors have been removed from the large-cap and
diversified model portfolio. Please note that the weightage for State Bank of
India and Divis Laboratories have been revised. Affirming our view on
consumption demand, Dabur (5%) and Marico (4%) continue to be part of our
large cap portfolio.
Brigade Enterprises given 6% weightage and Somany Ceramics given 6%
weightage are the latest addition to the mid-cap portfolio. Exide Industries and
Graphite India have been removed from the mid-cap and diversified model
portfolio.
We remain positive on auto, IT and pharma. We remain overweight to neutral
on pure play defensives (IT, FMCG) as secular earnings coupled with sector
rotation could lead to consolidation in near term valuations and offer stock
specific opportunities.
We continue to remain underweight on metals and oil & gas with our only pick
being Gail Ltd., which has a better risk reward opportunity. Among individual
names, we recommend TCS in the IT space, HDFC and HDFC Bank in the BFSI
space and ITC in consumer space.