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LIC Mutual Fund expects outflow of foreign portfolio investment to reverse as India is the only bright spot in the emerging markets amid global uncertainty.
Yogesh Patil, Chief Investment Officer (Equity), LIC Mutual Fund said foreign investors pulling out of the Indian market is a temporary phenomenon and the emerging market funds managed by FPIs have no other markets to invest as every other emerging country be it China, Turkey, Brazil, Russia, Indonesia or Argentina, are battling their own crises besides geopolitical disturbances.
Poised for growth
Indian economy is in a sweet spot, similar to where China was 20 years back and the US was in 1972. It is poised for a good economic growth, he said, in an event to launch LIC Multi-cap new fund offer, the first equity fund launch in last one year.
The NFO will be open for subscription between October 6 and 20. It will be available for ongoing subscription from November 2.
The multi-cap strategy works well for the investors as it makes disciplined allocation of 25 per cent each in large, mid and small cap stocks and the remaining is left to the fund manager’s discretion.
In some of the sectors such as chemicals, paints, footwear and auto ancillary the growth potential is only in the small-cap segment, said Patil.
Shrugging off concern on rising interest in the US, he added that India is the only country with a real positive interest rate and the high potential for growth. “I do not think the US has slipped into recession, which is a harsh word. The demand in the US has slowed down due to consistent rise in interest rate. It will bounce back once the rates are cut marginally,” he said.
TS Ramakrishnan, Managing Director, LIC Mutual Fund said two more equity funds will be launched to fill in the gaps in product offerings and the immediate target is to grow equity asset by 40 per cent from the current level of ₹8,000 crore.
The talks to acquire the schemes of IDBI Mutual Fund are in the final stages and this will add another ₹4,000 crore to the overall asset under management of ₹18,000 crore, he said.
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