"This is the time to be in multi-caps and diversified. A year back as a fund house, we were recommending only mid-caps as large-caps were highly valued; consumption which dominates the large-cap space was not visible and valuation of midcaps in the certain key sectors were very attractive" Mr Subramaniam told NDTV.(Watch)
Now, things have changed after the presentation of the Budget in February, he said.
"With huge allocation of money to rural infrastructure, the announcement of OROP (One Rank One Pension), Seventh Pay Commission and a reasonably good monsoon prospects ahead, we feel rural consumption is going to be big booster this season," the fund manager said.
The implementation of Seventh Pay Commission awards will also boost consumption in rural India as 55 per cent of government employees work in semi-urban and rural India, he said.
So, a multi-cap approach at this point of time with a tilt towards the rural side will do well this season, he said.
Mr Subramaniam defined multi-cap allocation as 50 per cent in large-caps and 50 per cent in mid and small- cap stocks in market-cap terms. In terms of number of stocks, it should be 70 per cent in to mid-caps and 30 per cent in large-cap stocks, given the relative market weights, he said.
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