8 February 2017
Senior executives of India’s largest Asset Management Company, ICICI Prudential Asset Management were in Chandigarh town to share the fund house views on Outlook 2017 and where retail investors should invest in the year ahead.
Aniruddha Chaudhary Zonal Head (North, South and East) were joined by Sourabh Mahajan, Regional Head ( Rajasthan, Punjab, Haryana, Himachal Pradesh, J&K) and Shri Anish Jindal, Director, Finbucks Financial Management, a leading financial advisor in Punjab for the press briefing.
Aniruddha Chaudhary highlighted the benefits of investing in Mutual funds for retail investors and mentioned that investors in Punjab are still overinvested in traditional investment avenues. For creating long term wealth, they need to diversify and invest in equity Mutual Funds. He complimented the market regulator SEBI for its work since Mutual Fund industry in India is seen as one of the best regulated areas in finance. This has led to making Mutual Fund as one of the best investment avenues for the retail investor and there is reasonable evidence of investor satisfaction through wealth creation by investing in such a transparent and low cost product.
He congratulated and acknowledged the efforts of the financial advisors and distributors in Chandigarh along-with media in making Mutual funds more popular. However, given the under penetration and lack of exposure to equities, he shared his view that much more is needed to be done.
He stressed upon the benefits of SIPs in long term wealth creation and as a preferred mode of investing in equity markets. The MF industry in India has seen notable interest in SIP book size growing from 1800 Crs per month in March 2015 to nearly 4000 plus Crs in December 2016.
On the recommendations for 2017 for retail investors, Shri Chaudhary mentioned that with macros remaining supportive, RBI has still some room left to cut rates in 2017. However, we believe that most part of the fixed income rally has already played out and returns may moderate from hereon. Having said this, we still believe that over the next three year period fixed income may continue to deliver good post tax returns in comparison to traditional fixed income investment avenues. For 2017, we are recommending retail investors to invest in dynamic duration, short duration and accrual funds. For equities, we believe that dynamic asset allocation is a better choice to take exposure to equities in order to make best of the volatility which could emerge from global side. Also in a country where the base financial product is fixed deposit, you need an asset class with lower risk than equities to scale up investor interest in mutual funds. He also reiterated the importance of continuing with SIPs.
Jindal mentioned that ICICI Prudential as a brand has maximum recall amongst investors and he is seeing a lot of investor interest in their schemes. The company as on 31 December, 2016 manages INR 2.27 lac crs across various schemes. As per Value Research, a leading MF data provider, the fund house has ensured that their schemes outperform their respective benchmarks, on a consistent basis, and this has helped the AMC to deliver better investor experience.
Chaudhary cited the company’s focus on investor experience, promoting right products at right time, listening to customers and distributors and superior investment management capabilities as reason for their growth and industry leadership.
On being asked about the measures that can help the industry to grow, Shri Chaudhary mentioned that simplified KYC process as available to insurance industry and adequate remuneration for distributors can help the industry to grow much faster.
Mahajan shared information on the fund house’s IPRU Touch app, which helps distributors and investors to transact in a very convenient and cost effective manner with no paper work.
Jindal shared information on various schemes of the fund house and specifically recommended ICICI Prudential Equity Income Fund, ICICI Prudential Balanced Advantage Fund, ICICI Prudential Balanced Fund and ICICI Prudential Dynamic Plan for lumpsum investments. For SIPs, he recommended ICICI Prudential ICICI Prudential Multicap Fund, ICICI Prudential Focused Bluechip Equity Fund and ICICI Prudential Value Discovery Fund.