Resham Jain, VP Investment at DSP MF, underscores the robust momentum in the smallcap and midcap sectors, advocating a strategic long-term investment perspective. Notably, these sectors have exhibited noteworthy growth, outperforming their larger counterparts. While their performance augurs well, it’s essential to acknowledge the heightened risks associated with smallcaps.
Stock Selection and Investment Strategy
Jain sheds light on DSP MF’s investment philosophy, underscored by comprehensive documentation encompassing small and midcaps. The emphasis is placed on evaluating business models, management quality, and valuation metrics. Interaction with a company’s management further bolsters informed decision-making, complemented by quarterly reports and annual disclosures. Jain accentuates the necessity to thoroughly understand a company before investing, warranting prudent due diligence.
Sector Focus and Strategy
Consumer-centric companies are recommended with a substantial 40-50% weightage, attributed to their growth prospects within India’s evolving landscape. Jain also lauds the manufacturing sector, citing several successful segments. However, the banking sector sees a more cautious approach within the smallcap realm. Jain indicates a decreased allocation to banking stocks in their portfolio, preferring a careful selection of smaller banks with limited volatility.
While offering valuable insights, it’s crucial to remember that views expressed by experts are personal, and individuals are advised to seek certified expert advice before making any investment decisions.