The Hindu Business Line : Money Talk

Shahina Mukadam, who heads the research function at IDBI Capital Markets, is a seasoned hand at investing and has been closely tracking the stock market for several years now. A chartered accountant by profession, prior to joining IDBI Capital Markets as an analyst, Ms Mukadam did stints with HDFC Securities, Motilal Oswal Securities and JBS Vickers Research. The Indian pharmaceutical sector has been one of her key areas of expertise. Here, she takes a few questions on her personal investment preferences:

When did you start investing?

1994.

Did you start with investment in real-estate before you moved on to direct investing?

Yes, I wanted to own a home while knowing that in all likelihood it would give lower returns than stocks.

Have you followed any asset allocation pattern for your own finances to start with and how has it changed over the years? Are you systematic in the allocation of finances?

I am fascinated with the equity market. So, most of my savings are invested directly in stocks. Over the years, I have retained a large part of the profit (and the capital) in the equity market. I invest directly (except for a small SIP), as I spend a lot of my time analysing company balance-sheets. In 2001, I insured myself with a unit linked policy to provide for any unforeseen event. To limit my downside risk and avoid desperate situations, I have no mortgages/loans and do not leverage my equity holdings.

Which was the first stock you picked, at what age and did you make money on it? Any learnings from that experience?

I invested in the State Bank of India IPO. I still hold it and enjoy the impressive returns on the amount invested. Some other penny stocks I bought at around the same time, based on `tips' have long vanished. I firmly believe one should buy fundamentally-sound stocks at reasonable valuations and hold them for the medium/long-term, after periodic review.

Do you have any specific return expectations from your portfolio?

With the market having given around 100 returns over the last five years, one gets accustomed to expecting big returns. While I have moderated my return expectations for the next year, I still aim for 35-50 per cent return in FY-07.

Do you entrust funds to a financial planner/portfolio manager or handle them directly?

Most of it is handled directly, being a qualified financial analyst myself.

Stock-specific or/sector-specific performance that you are impressed with...

In the last year, real-estate/construction/engineering sector have given impressive returns.

Books on investing that have impressed you...

Warren Buffet

Your advice on three things that budding youngsters should do when they start investing.

Do not leverage. Invest only surplus money in equities. Invest in businesses/companies you or someone well known to you is familiar with.

Suresh Parthasarathy

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