The CA whose focus is on mastering the art

of generating alpha on Dalal Street WHAT'S YOUR MARKET SCORE?

The market veteran asks investors not to sell as long as a company continues to grow and
add value. QUESTION: 1/3 HIGHEST SCORE: 30
0
By Rahul Oberoi, ETMarkets.com | Last Updated: Nov 25, 2019, 10.18 AM IST Save

4 Which of the following in not a

Sunil-Singhania
The market veteran finds the current
market very challenging, considering
the bleak picture of the economy.
Related
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Sebi informs market stakeholders
about FATF's sanctions against
North Korea, Iran
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direct tax?
The ability to generate alpha in times of distress shows
the capability of fund managers. And market veteran Income Tax
Sunil Singhania (50) is obsessed with it.
Sales Tax
Singhania floated his portfolio management service firm,
Abakkus Asset Management, in August 2018. And the
Estate Duty
first midcap-focused fund he launched delivered around
7-8 per cent return to investors till October 2019. That
Wealth Tax
stood out because midcaps were down in the dumps
through this period, with the BSE Midcap Index declining
7 per cent.
Growth at Reasonable Price

Singhania’s firm manages close to Rs 2,000 crore now. HDFC 1632.20 -0.01%

Bajaj Finance 2076.55 -1.68%

Before floating Abakkus, Singhania also proved his mettle earlier as CIO of Reliance UltraTech Cem. 3578.65 -0.85%
Mutual Fund. Under Singhania, Reliance Growth Fund delivered a 21 per cent return
Aurobindo Pharm 667.70 0.32%
CAGR from 2004 through 2017, outperforming the S&P BSE100’s 14 per cent CAGR
returns. Ambit Capital named him in its report on ‘Mastery in Indian Equities’.

Investment strategy
Why follow tips? Choose your winners
A humble Singhania says he has no fixed formula to discover a stock. “It is not
rationally in 3 simple steps!
mathematics. It is the combination of a lot of things,” says he.
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But Singhania does follow a framework, he calls MEETS, an acronym for management,
earnings, events, timing and structure. “That’s our core philosophy in stock selection,” he
Related Most Read Most Shared
said.
Taking stock of Dalal Street

Historic market crash! How Dalal Street digested it

The Mumbai-based investor said his team does also go through past history of a company
For Dalal Street still no light at the end of the tunnel
and runs various models for stock selection. “We continuously meet companies. And then
also, we do secondary research. So it is a combination of a lot of these things put Dalal Street firms weigh the long and short of work
from home
together,” he said.
Dalal Street moving in lockstep with global peers,
will face bumps ahead
That approach helped Singhania spot big opportunities Bajaj Finance and Eicher Motors
early. Dalal Street week ahead: Rally offers relief, but the
trend remains bearish

When to sell a stock?

The market veteran asks investors not to sell a stock as long as the company continues to
grow and add value. “You should not sell a stock just because the stock price has moved
up. I do not think that is the right way of managing a portfolio,” he said.
DISCOVER MUTUAL FUNDS

At the same time, he says when one goes wrong with an investment decision, one should
not make any delay in selling a stock. “Investors should also offload a stock if it have All Mutual Top Tax
Funds Saver Funds
moved up too much beyond fair value. Lastly, one can also exit a stock if there is better
opportunity elsewhere,” he said.
Better Than Low Cost
Fixed High Return
The right stock price, Singhania says, is a reflection of a lot of different things. “Remember, Deposits Funds

buying a stock is like becoming a partner in a company,” he insists.

“One should buy a stock if the value of the business is justified at that point of time. It is a
must to check management track record and growth prospects before taking any position,”
he said.
Trending in Markets
Tips to investors IPO Allotment Status Stock Screener Sensex

According to him an equity investor should invest in stocks only when she is positive on Stock Market Stock Recommendations IPO

the economy. “In the near term, she might end up making a lot of mistakes and find that Upcoming IPO Gold Rate Top Gainers
Rupee vs Dollar Share Market Silver Price Nifty 50
the market is rewarding her sufficiently. But ultimately, investing in equity is like investing in
Nifty Bank Infosys Share Price Crude Oil Price
a growing asset. In a growing economy, a growing asset class will always give you more
returns than any other,” he said.

Why equity market as career?

Singhania says he has always been a voracious reader and did not hide his love for Not to be Missed
reading balance sheets in his early days. A chartered accountant by profession, he later Debate: Will a self-reliant India turn
did CFA. protectionist?

“I used to practice, but my heart was always in the balance sheet. So, the interest grew
View: Run trains for migrants to reach
and from there on in the mid-90s when the economy started to open up, I got the
home
opportunity to move full time into the equity market,” he said.

Views on the current market

The market veteran finds the current market very challenging, considering the bleak Packages will have impact of Rs 1.29L
cr on fiscal deficit
picture of the economy. “Too much money is flowing into so-called quality names and they
are trading at 70-75 price-to-earnings and whereas others are trading at significantly lower
valuations,” he pointed out.
'Govt has fiscal space of Rs 20k cr for
stimulus'
“With the Sebi reclassification of stock categories for mutual funds and a general apathy
towards midcaps and smallcaps, no one wants to buy smaller companies and, therefore,
their valuations are now at significant discount to their largecap peers,” said Singhania.
CPSEs may give 25% rebate on power
bills to discoms
The value investor said he is currently looking for opportunities in companies that are
below Rs 7,000 crore in market capitalisation. “Valuations are in our favour from a longer-
term perspective. We are not looking at a particular sector, but the aim is more towards
trying to see if we can invest in companies where valuations are in our favour just because India's foodgrains production to touch
record 295.67 MT
technically no one is looking at them,” he said.

Read this article in :Hindi

Read more on Sunil Singhania Reliance Mf Dalal Street Alpha Generation Slovenia opens borders after declaring
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Abakkus Asset Management

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