Naren Sankaran is a good contrarian fund manager. Maybe great. Frankly I would love to have SN as my portfolio manager than as my MF manager. There are too many restrictions on Mutual funds and fund managers are still constrained by all that. Having said that I know that some shares that SN would like to buy are beyond him. Take Lakshmi Machine Works – immaterial of the cycle, LMW does not do enough volumes. Ditto for MRF or L G Balakrishna. SN cannot buy them in his portfolio, and that is a huge problem for a fund manager (not just SN in particular). The other problem that he must be having is a daily scrutiny of his portfolio (ok once in 90 days, but the fact sheet is still made on a monthly basis) – and the public commenting on that (ask Prashant Jain!!).
So when PJ took a punt on SBI, ICICI BANK, and Infosys most people were up in arms were they not?
So if you do invest in a SN fund like Discovery – you need to take a leap of faith. That fund is market cap agnostic and in India it does not have a benchmark (Ok I know now he does not directly handle that fund). So if he shifts from being mid and small cap oriented he is also FORCED to change the benchmark. Makes little sense, but comparing Discovery Fund to the regular benchmark is a joke. Seriously. I invested in I Pru Discovery the day SN took charge and from time to time..but I have no clue how much I have invested and how much is the return. I know I will not touch it for another decade, at least.
One thing about SN is that his style is very different from say a Sameer Arora, but that will not stop him from seeing what other fund managers are doing. One amazing thing about SN is he loves criticism. He in fact thrives on people pointing out his mistakes, and welcomes it.
Other than these few things Larissa has captured it well. Larissa has blossomed into a very good investment oriented writer and of course writes well….read here:
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