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One of the country's biggest fund manager advises investors to buy the dips

personal finance | Sept 29, 2022 2:13 PM IST

One of the country's biggest fund manager advises investors to buy the dips

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What is meant by buying the dips and how has markets performed recently? Which stocks should you buy? Read on to understand these

Nilesh Shah, one of the country's biggest fund manager and the managing director of Kotak Mahindra Asset Management, said buying the dips is the best strategy in the Indian markets. There can be near-term challenges, but India will become the third largest economy by 2030, Shah told CNBC-TV18 in an exclusive chat.

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By buying dips, Shah meant that investors should buy stocks when their prices are very low.
When stock markets fall considerably, the prices of most stocks drop and, hence, are available at far lower prices than earlier. Even blue-chip stocks are available at lower prices, and thus it gives a choice to investors to choose from a wider range of stocks.
Buying the dip is best suited for long-term investors as they can enter certain stocks at lower prices and book profits as soon as the market jumps back.
Shah further said that  India would outperform, but margins may taper down.
"On a near-term basis, India is expensive. But on a five-year basis, the market is cheap," he said.
A look at market performance
In the past eight sessions, Nifty50 has been down over 6 percent. On a year-to-date (YTD) basis, Indian markets (S&P BSE Sensex) have been flat primarily due to the major correction seen during the beginning of this calendar year.
According to a Morgan Stanley report, the monetary policy tightening in the US and strength in the dollar could continue to be a source of volatility for Indian equities in the coming months.
Sensex, Nifty 50, Nifty Bank and Nifty Midcap 100's performance on Thursday:
So, what should investors buy?
Shah said that small and midcap IT companies had run ahead of fundamentals. He thinks the next six months is a good time to start accumulating IT companies.
Here's a look at the performance of the Nifty IT index on Thursday:
About Kotak Mahindra AMC
Kotak Mutual Fund was established in December 1998 and is a wholly-owned subsidiary of Kotak Mahindra Bank. Kotak Mahindra Asset Management Company (KMAMC) is the asset management company for Kotak Mahindra Mutual Fund.
It offers a wide range of mutual fund schemes across equity, debt and hybrid categories along with the fund of fund schemes and exchange-traded funds.
Here's how some of the top Kotak Mahindra AMC's funds have performed in the last 1-year:
Scheme NameCategoryLatest1 year
NAVReturn (%)
Kotak Balanced Advantage FundAggressive Hybrid Fund15.21.7
Kotak Balanced Advantage FundAggressive Hybrid Fund14.470.4
Kotak Banking and PSU Debt FundBanking and PSU Fund53.282.5
Kotak Banking and PSU Debt FundBanking and PSU Fund54.92.9
Kotak Banking ETFIndex Funds/ETFs383.510.1
Kotak Bluechip FundLarge Cap Fund360.81-5.4
Kotak Bluechip FundLarge Cap Fund401.35-4.2
(Source: Moneycontrol)
According to AMFI, the average assets under management (AUM) of the Indian mutual fund industry for August 2022 stood at Rs 39,53,423 crore. AUM of the Indian MF industry, as on August 31, 2022, stood at Rs 39,33,878 crore.
The total number of accounts (or folios as per mutual fund parlance) as on August 31, 2022, stood at 136.5 million, while the number of folios under Equity, Hybrid and Solution Oriented Schemes, wherein the maximum investment is from the retail segment, stood at about 108.9 million.
Indian MFs have currently about 57.2 million SIP accounts through which investors regularly invest in Indian MF schemes.
Details of new SIPs registered and discontinued during FY 22-23 are as under : (SIP count in lakh):
MonthTotal No. of outstanding SIP AccountsNo. of New SIPs registeredNo. of SIPs discontinued/ tenure completedSIP AUM croreSIP Contribution crore
Apr 22 – Aug 22 571.6198.0554.176,39,78761,258
Aug 22 571.6121.1311.466,39,78712,693
Jul 22561.94 17.4210.376,09,29612,140
Jun 22554.89 17.9311.455,51,18912,276
May 22 548.41 19.7510.365,65,70612,286
Apr 22  539.02  21.82 10.535,78,08611,863
Apr 21– Mar 22527.73266.36111.175,76,3581,24,566
(Source: AMFI)
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