Fund management is about processes, and I like fund houses with a good process, and smart people. Smart people means those people – Anand Radhakrishnan or Roshi Jain – in this case who know that the process is more important than the people who run them.

Now I have a funny problem. I have been an investor in a fund called “Templeton India Growth Fund” – a fund from the Templeton stable (slightly different from the Franklin stable). I must have first invested in 2002..and stuck with it till TODAY, of course under the growth option. This was typically a value fund – and hence for me the value style mattered more than the regular day to day returns. This is easily the most disciplined, rigorours fund in the country – and I am willing to debate about this.

Mark Mobious and Chetan Sehegal had an amazingly discipline approach – Infosys would enter the portfolio when its prices fell, and would exit the portfolio when the price earning ratio crossed some kind of a threshold. Yes I am a happy investor in a fund which never received the attention or respect that it deserved in the FT hierarchy. No, this is not a crib about their sales priorities – FT is a funny combination of being an asset gatherer and asset manager. Occassionally you see the separate hats, but that is for a different post.

Now my worry is – is Anand a good CIO or is he a good investment manager? or is he both? I do not know him personally well enough to judge him. He is a process driven person – and has a good track record. He knows that his flagship Franklin India blue chip is underperforming the Index because Reliance Industries is missing. I am fine with a fund manager who stands by his conviction and refuses to fall for the flavor of the month (or week, or decade depending on your time horizon). Personally I would like somebody from Morningstar’s team to do a detailed interview and tell us what direction this fund is going to take. I like the fund house (I am not sure whether any fund house likes me, so I guess it is one sided), and I liked the smooth transition from Chetan Sehegal to Vikas Chirnewal. Chetan continued to share research responsibilites – not sure what is the status now. TIVF (aka TIGF for a long time) was clear that it would seek value by looking at the PE of the company and sector. So seeing Icici there instead of Hdfc made sense (personally I will not hold Icici in my investing portolio, and have held H bank since 1994, and will trade in both the banks from time to time). I like TIVF because it plays the contrarian role in my life. However, a fund manager can say “i see value in the growth potential of the company” – of how I bought Bharti Airtel at Rs. 80 long long ago. I have liked the disciplined approach of Mark Mobious – the real biological parent – of TIGF. I also want to be challenged by somebody when I call this the “most disciplined fund scheme”. I like value orientation, and have been a fan of Naren’s Icici Pru discovery and have stuck around with that fund – I just will keep holding till Naren is the CIO of I Pru amc. 18 years is a long time for me in TIGF – and the review is because I do not know how AR will change the culture of this fund. If I want AR I will stick to FIBC (I am invested in that as well as Prima Plus and Flexicap – since Flexi IPO – and almost similar trime frame in Prima plus – please check out the new names, I am too lazy to).

The skill in managing a fund with a Value orientation is to know whether you are in a “discovery” mode or are you in a value trap. I am sure all the wisdom of MM and the discipline of FT (like Santosh Kamath in debt !!!). What I like is the process, what I do not like is that the FT sales team ignores this fund – which means the economies of scale will NEVER happen. However, putting AR as the FM (Jan 2019) maybe an indicator of things to come, I am just guessing. I do not like the cost of the fund management – but FT has always been an expensive fund house – it is the Merc, not the Indica of the industry, but this fund has delivered value for sure (I have not done a Tigf vs I Pru discover, I invested in both, maybe similar amounts). I also do think that in value investing you (fund manager and the amc) have to be willing to look foolish for real long periods of time. Will AR’s style make FIBC and TIVF look like Hdfc Top 100 and Hdfc Equity fund? At least Prashant does not fall into the classic ‘style trap’. Will FT not lose focus? Will FT merge it with some other fund? (I am an investor since inception in Templeton India Equity Income fund, inspite the FT sales team!!!). I want Morningstar to do a detailed interview with AR about his philosophical approach to Bluechip and TIVF. And fast please, I need better data usage. I have used gut, you should use data.

funny gut feeling. The new arrangement may not suit me. That of course is a personal choice.

 

 

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