Aditya Birla Sun Life AMC Limited

Equity Outlook Monthly Update - February 2019

Mar 02, 2019
4 mins | Views 5484
  • The volatility seen in the equity markets in 2018 continued in January, 2019 as well. On one hand, global macro concerns have moderated and sentiments for Emerging Markets were boosted after a dovish US Fed commentary.
  • Domestic equity market sentiments was impacted by a mixed 3QFY19 reporting season and investor concerns in companies with perceived lapses in corporate governance.
  • With inflation consistently undershooting estimates and well below the RBI’s target of 4%, the RBI is expected to pause and even cut rates this year.
  • Nifty companies have shown robust revenue growth, however operating margins and Profit After Tax (PAT) have been under pressure.

  • Valuation parameters after the recent correction have become reasonable and the market looks attractive with visible growth earnings and strong fundamentals.
  • On the whole, it expected that India will grow faster than other countries and long-term outlook for the domestic market continues to be strong.

Source: ABSLAMC Research, Bloomberg

Portfolio Action
  • Aditya Birla Sun Life Equity Fund (An open ended equity scheme investing across large cap, mid cap, small cap stocks):

    An Indian multinational construction firm was a new entrant to the portfolio, a well-restructured balance sheet and strong management places it in a sweet spot to benefit from continued spending in public infrastructure. We Continue to increase exposure to corporate banks, with faster resolution of NPA would reduce provision cost. The fund maintains its cautious stance on the markets and continues to look for value in order to deploy cash.
  • Aditya Birla Sun Life Balanced Advantage Fund (An open ended Dynamic Asset Allocation fund):

    We increased exposure to a corporate bank, the strong liability franchise and healthy capitalisation provides strong earning visibility. An Indian cement company was another new entrant to portfolio basis positive outlook & available at attractive valuations. Current portfolio, on equity side is more large cap biased but shall take exposure to selective midcaps at opportunistic levels.
  • Aditya Birla Sun Life Equity Hybrid ‘95 Fund (formerly known as Aditya Birla Sun Life Balanced ’95 Fund) (An open ended hybrid scheme investing predominantly in equity and equity related instruments.):

    The portfolio continues to be overweight consumer discretionary and private banks as demand growth is improving. During the month, increased stake in an Indian consumer goods company as stock is attractively valued. We also added a housing and rural finance company as stock is attractive at current levels post corrections after the announcement of its merger.
All the Data mentioned above is as on 31st January 2019
The Scheme(s) may or may not have any present or future positions in these sectors
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
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