MidCap Portfolio – Come, Invest in India


Date: 19th Aug 2014

JainMatrix Investments launched its Mid and Small Cap portfolio in Feb 2013. This is the fifth update report on this portfolio, along with a brief investment note.

(Our portfolio is only shared with Subscribers, but here’s the Investment Outlook from this report). 

Mid/Small Cap Model Portfolio – Aug 2014 – Investment Outlook

  • It’s been only 4 days since Independence day, but in these 4 days, a lot has changed in terms of our business and economic outlook. On I-day, India’s PM addressed the country and spoke about his concerns, his desires as PM, and his new initiatives through governmental action and funding.
  • I will not go into any specifics. All I can say is that the PM feels strongly about the right things. This is a PM of stature. He is the right man in the right place. In 5 or 10 years as ‘Prime Sewak’ he will be able to give a new direction to governance, business and economy in India. He has also set up a powerful team to execute on his ideas.
  • Indian business has in the past made their achievements in a tough environment in terms of govt. policies. So if these improve, things can only get better and easier from here for business.
  • The PM’s brilliant call rings in my ears – Come, Make in India. On these lines, our title theme is – Come, Invest in India
  • Post budget, the markets were in a down mood after those heady days, and had some doubts over the next few weeks, but we are now past that. More than before, it’s now time to be positive in the market. Stay invested in well-chosen stocks.
  • We notice a pattern in the mid & small cap shares. After highs around the budget time, many of these have corrected sharply thereafter. And after a fall, started recovering. Investors need to understand that by their nature, these shares are volatile and move rapidly in both directions in the short term. In general, investors need not get overly concerned about sharp movements. Typically a positive event (budget) that gave new highs to many firms, may be followed by a technical correction, which again may be followed by a recovery (if fundamentals are strong).
  • The INR/USD is at 60.7, and should be in a 60 +/- 2 band for a few months barring extreme events.
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Portfolio Theme and Performance

  • The investment theme continues to be – IT and Auto ancillary exports, infrastructure and rural/ semi urban consumption. The investor should continue his wealth building process with Mid and Small Caps.
  • In a very positive environment, the portfolio performed very well. On average the 7 Buy recommendation shares were up by absolute 104% and annualized 89%. But including the two Holds the portfolio gained by absolute 77% and annualized 67%.
  • The CNX Midcap, BSE Midcap and BSE Smallcap are benchmark Indices, and were up by 33.7%, 33.8% & 44.6% absolute in the period. The JM active Mid/Small Cap portfolio outperformed by 59%.
  • Investors need to continue to invest in these shares in a SIP mode.

The rest of this report is shared with only current subscribers. 

Some previous updates for the JainMatrix Investments Mid and Small Cap Model Portfolio

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This document has been prepared by JainMatrix Investments Bangalore (JM), and is meant for use by the recipient only as information and is not for circulation. This document is not to be reported or copied or made available to others without prior permission of JM. It should not be considered or taken as an offer to sell or a solicitation to buy or sell any security. The information contained in this report has been obtained from sources that are considered to be reliable. However, JM has not independently verified the accuracy or completeness of the same. Neither JM nor any of its affiliates, its directors or its employees accepts any responsibility of whatsoever nature for the information, statements and opinion given, made available or expressed herein or for any omission therein. Recipients of this report should be aware that past performance is not necessarily a guide to future performance and value of investments can go down as well. The suitability or otherwise of any investments will depend upon the recipient’s particular circumstances and, in case of doubt, advice should be sought from an independent Financial Expert/Advisor. Either JM or its affiliates or its directors or its employees or its representatives or its clients or their relatives may have position(s), make market, act as principal or engage in transactions of securities of companies referred to in this report and they may have used the research material prior to publication. Any questions should be directed to the director of JainMatrix Investments at punit.jain@jainmatrix.com


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