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Rohit Singhania started co-managing DSP India TIGER in June 2010 and took over as a lead manager in June 2012 from Anup Maheshwari. As a comanager, he has had a strong influence on the stock/sector picks and portfolio construction even during Maheshwari’s tenure. We believe his skills are well-suited to the job as he has extensive analyst experience in tracking infrastructure-related sectors.Singhania’s core investment universe encompasses infrastructure sectors and those that are subject to economic reforms. Sectors such as technology, consumer staples, autos (consumer-related), and domestic pharmaceuticals doesn’t form a part of the investment universe. Singhania follows an unconstrained approach and invests in growth and value stocks, with strong emphasis on the former. He focuses on understanding the key drivers of a business, the company’s underlying assets, management capabilities, and scalability prospects. He invests in issues whose ROEs and ROCEs are on an uptrend and uses historical valuations to evaluate a company’s fair value. Within the defined limits, Singhania’s stock-picking criteria are varied and flexible enough to allow for nearly any type of pick. The strategy relies heavily on the manager getting his calls right, leaving little margin for error. The risks are amplified here, as stocks from the infrastructure sector are prone to intense cyclicality as has been the case this year so far.There have been significant changes in the equity investment team, which is becoming a cause for concern. Over the past few years, the team has lost some key managers such as S. Naganath (CIO), Maheshwari (CIO-equities after Naganath), Harish Zaveri, and more recently Gopal Agrawal. In fact, Agrawal’s exit has destabilized the team again, which was trying to find a firm footing after the exits of its senior managers.This strategy here allows Singhania to play to his strength. That said, the fund has a thematic flavor, which typically has limited appeal. Such funds offer a high risk-high reward investment proposition and are apt only for those investors with a stomach to withstand the high risks associated with such strategies. In the light of the same, we assign a Morningstar Analyst Rating of Neutral.
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