103819  |  INF740K01094  |  5 star  |  Neutral

NAV

$ 204.32

1-Day Total Return

-0.10
%
INR | NAV as of 22/08/2017 09:30:00 | 1-Day Return as of 22 Aug 2017

TTM Yield

0.00%

Load

Multiple

Total Assets

31.5 bil

Expenses

2.68%

Fee Level

--

Turnover

182%

Status

Open

Min. Inv.

1,000

30-Day SEC Yield

--

Category

Large-Cap

Investment Style

Large Growth
Author
Morningstar's Take | 21/12/2016
by Himanshu Srivastava

The fund has a new skipper in Rohit Singhania, who took over its mantle in June 2015. It was earlier helmed by Apoorva Shah (August 2012 – May 2015) and Anup Maheshwari (December 2006 – July 2012). While both Maheshwari and Shah have moved to the fund house’s offshore division, the former continues to head the equity team, which certainly helps the team’s cause.

Singhania joined the fund house’s PMS division as research analyst in 2005 and moved to the equity investment team in June 2009. He is not new to fund management, having managed the DSP BlackRock TIGER fund since June 2012. While Singhania is a seasoned analyst, over the years he has matured as a portfolio manager as well. However, it should be noted that he has a track record in managing the DSP BlackRock TIGER fund, which has a thematic bent.

Despite the change, the fund’s broader investment strategy remains largely unchanged. In fact, Singhania runs this fund in line with its investment mandate, which allows him to adopt a fluid investment approach without any bias or restrictions in terms of stocks or sectors. In the manager’s own words, this fund doesn’t have a defined investment approach; this provides him the liberty to capitalise on any investment opportunity that he sees in the market, provided it makes a grade on his selection parameters. Consequently, the fund’s portfolio turnover tends to be on the higher side.

While an unconstrained process can be very rewarding, it is fairly risky, too. A wrong bet can lead to significant underperformance. Also, the absence of a rigidly defined method means investments are also made on a somewhat intuitive basis. Hence, it must be noted that the success of the investment process largely depends on Singhania’s execution skills. Although he has been in control of the investment process thus far, it’s a short time frame to build conviction. Under Maheshwari and Shah, the fund had a Morningstar Analyst Rating of Silver. However, we would like to adopt a wait-and-watch approach for now and assign it a Neutral rating until we gain more conviction in Singhania’s investment and execution capabilities.

Morningstar Analyst Rating™
Analyst Rating
Portfolio Role

The manager adopts an unconstrained and unbiased approach while constructing the portfolio.

People

Rohit Singhania is an able analyst.

Parent

We believe DSP BlackRock ranks among the best asset managers in the country.

Process

Growth-oriented bottom-up strategy at play.

Performance

Singhania has posted impressive performance in his short stint with this fund thus far.

Price

The fund’s expense ratio is higher than the median of the India large-cap category.

Important Disclosures

Unless stated otherwise, this report was prepared by the person(s) noted in their capacity as Manager Research Analysts (i.e., fund analysts) employed by Morningstar, Inc., or one of its affiliates. It has not been made available to the issuer prior to publication.

Analyst Ratings are subjective in nature and should not be used as the sole basis for investment decisions. Analyst Ratings are based on Manager Research Analysts’ expectations about future events and therefore involve unknown risks and uncertainties that may cause such expectations not to occur or to differ significantly from what was expected. Analyst Ratings are not guarantees nor should they be viewed as an assessment of a fund’s or the fund’s underlying securities’ creditworthiness.

No material interests are held by Morningstar or the Manager Research Analyst in the financial products that are the subject of the research reports or the product issuer. Regarding Morningstar’s conflicts of interest: 1) Manager Research Analysts’ compensation is derived from Morningstar’s overall earnings and consists of salary, bonus and in some cases restricted stock; however, Manager Research Analysts are neither allowed to participate directly or try to influence Morningstar’s investment management group’s business arrangements nor allow employees from the investment management group to participate or influence the analysis or opinion prepared by them. Further information on Morningstar’s Code of Ethics policies is available from http://corporate.morningstar.com/us/asp/subject.aspx?xmlfile=540.xml

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