Motilal Oswal Asset Management Company Ltd. (MOAMC) is a public limited company incorporated under the Companies Act, 1956 on November 14, 2008, having its Registered Office at 10th Floor, Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai - 400025.
Motilal Oswal Asset Management Company Ltd. has been appointed as the Investment Manager to Motilal Oswal Mutual Fund by the Trustee vide Investment Management Agreement (IMA) dated May 21, 2009, executed between Motilal Oswal Trustee Company Ltd. and Motilal Oswal Asset Management Company Ltd.
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Motilal Oswal Asset Allocation Passive Fund of Fund – Aggressive (G) - 11.3885Motilal Oswal Asset Allocation Passive Fund of Fund – Aggressive-Dir (G) - 11.4225Motilal Oswal Asset Allocation Passive Fund of Fund – Conservative (G) - 10.9704Motilal Oswal Asset Allocation Passive Fund of Fund – Conservative-Dir(G) - 11.007Motilal Oswal Dynamic Fund (Div-A) - 14.1842Motilal Oswal Dynamic Fund (Div-Q) - 12.7036Motilal Oswal Dynamic Fund (G) - 15.6514Motilal Oswal Dynamic Fund-Dir (Div-A) - 14.4096Motilal Oswal Dynamic Fund-Dir (Div-Q) - 12.9208Motilal Oswal Dynamic Fund-Dir (G) - 16.5802Motilal Oswal Equity Hybrid Fund - Direct (G) - 16.4625Motilal Oswal Equity Hybrid Fund - Regular (G) - 15.6786Motilal Oswal Flexi Cap Fund(D) - 27.3339Motilal Oswal Flexi Cap Fund(G) - 36.363Motilal Oswal Flexi Cap Fund-Dir(D) - 27.4239Motilal Oswal Flexi Cap Fund-Dir(G) - 39.0054Motilal Oswal Focused 25 Fund - Direct (D) - 22.6364Motilal Oswal Focused 25 Fund - Direct (G) - 38.6678Motilal Oswal Focused 25 Fund (D) - 20.2883Motilal Oswal Focused 25 Fund (G) - 34.568Motilal Oswal Large and Midcap Fund - Dir (D) - 17.2812Motilal Oswal Large and Midcap Fund - Dir (G) - 17.2959Motilal Oswal Large and Midcap Fund (D) - 16.7151Motilal Oswal Large and Midcap Fund (G) - 16.7152Motilal Oswal Liquid Fund - Direct (Div-D) RI - 10.0077Motilal Oswal Liquid Fund - Direct (Div-F) RI - 10.0068Motilal Oswal Liquid Fund - Direct (Div-M) - 10.0325Motilal Oswal Liquid Fund - Direct (Div-Q) - 10.0059Motilal Oswal Liquid Fund - Direct (Div-W) RI - 10.0083Motilal Oswal Liquid Fund - Direct (G) - 11.2033Motilal Oswal Liquid Fund - Regular (Div-D) RI - 10.0055Motilal Oswal Liquid Fund - Regular (Div-F) RI - 10.0065Motilal Oswal Liquid Fund - Regular (Div-M) - 10.0323Motilal Oswal Liquid Fund - Regular (Div-Q) - 10.0058Motilal Oswal Liquid Fund - Regular (Div-W) RI - 10.0153Motilal Oswal Liquid Fund - Regular (G) - 11.1567Motilal Oswal Long Term Equity Fund (D) - 21.4455Motilal Oswal Long Term Equity Fund (G) - 27.2995Motilal Oswal Long Term Equity Fund -Dir (D) - 25.6021Motilal Oswal Long Term Equity Fund -Dir (G) - 29.8712Motilal Oswal Midcap 30 Fund (D) - 25.5353Motilal Oswal Midcap 30 Fund (G) - 41.7998Motilal Oswal Midcap 30 Fund-Dir (D) - 26.4538Motilal Oswal Midcap 30 Fund-Dir (G) - 45.9303Motilal Oswal Multi Asset Fund - Direct (G) - 10.9516Motilal Oswal Multi Asset Fund (G) - 10.7628Motilal Oswal Nasdaq 100 FOF - Direct (G) - 23.7316Motilal Oswal Nasdaq 100 FOF - Regular (G) - 23.4642Motilal Oswal Nifty 50 Index Fund - Direct (G) - 14.8365Motilal Oswal Nifty 50 Index Fund (G) - 14.727Motilal Oswal Nifty 500 Fund - Direct (G) - 17.1496Motilal Oswal Nifty 500 Fund (G) - 16.9213Motilal Oswal Nifty Bank Index Fund - Direct (G) - 13.8251Motilal Oswal Nifty Bank Index Fund (G) - 13.642Motilal Oswal Nifty Midcap 150 Index Fund (G) - 19.7512Motilal Oswal Nifty Midcap 150 Index Fund-Dir (G) - 20.0302Motilal Oswal Nifty Next 50 Index Fund - Dir (G) - 15.0414Motilal Oswal Nifty Next 50 Index Fund (G) - 14.8655Motilal Oswal Nifty Smallcap 250 Index Fund (G) - 20.4601Motilal Oswal Nifty Smallcap 250 Index Fund-Dir(G) - 20.7427Motilal Oswal S&P 500 Index Fund - Direct (G) - 14.9002Motilal Oswal S&P 500 Index Fund (G) - 14.7586Motilal Oswal Ultra Short Term Fund - Dir (Div-D) - 10.0051Motilal Oswal Ultra Short Term Fund - Dir (Div-F) - 10.0285Motilal Oswal Ultra Short Term Fund - Dir (Div-M) - 10.0121Motilal Oswal Ultra Short Term Fund - Dir (Div-Q) - 10.1563Motilal Oswal Ultra Short Term Fund - Dir (Div-W) - 10.0162Motilal Oswal Ultra Short Term Fund - Dir (G) - 14.1761Motilal Oswal Ultra Short Term Fund (Div-D) - 9.949Motilal Oswal Ultra Short Term Fund (Div-F) - 9.9598Motilal Oswal Ultra Short Term Fund (Div-M) - 9.9495Motilal Oswal Ultra Short Term Fund (Div-Q) - 10.0941Motilal Oswal Ultra Short Term Fund (Div-W) - 9.9526Motilal Oswal Ultra Short Term Fund (G) - 13.7027

A note on Focused 25 fund

Blog Blog Details
  • March 31, 2020
  • Siddharth Bothra|
  • Fund Manager, MF

Market corrections are broadly of two types:

1) Bear market correction driven by excesses in real economy, high leverage. It takes times and unravels in broadly three stages
2) Event driven corrections which we are witnessing now. These corrections are typically very sharp, but often reverse fast as well and ahead of event culmination.

In our opinion, the current correction is more the second type. Because we are not seeing any excesses in the economy, or high leverage in the markets, households or company wise. Furthermore, the sharp market correction has made valuations extremely attractive. While valuations based on P/E is at decadal lows, though the hit on FY21 earnings currently is still not known. However, one of the most reliable valuations tool which is used by none other than Buffett in such scenario is Market Cap to GDP ratio. Market Cap to GDP now is at ~50% vs decadal average of ~75%. Hence, in our opinion this is a favourable time to be invested in markets. Source MOSL research. Data as on 25-03-2020)

We believe conditions currently favour large caps. As we they are typically more resilient and have ability to whether such disruptions better. Moreover, given the slew of reforms in India over the last few years towards formalization of economy, we are witnessing a trend where the strong is emerging stronger and big is becoming bigger. As and when the recovery kicks in, in our view the smart money will be focused on market leaders and the larger caps.

We believe, Motilal Oswal Focused 25 Fund is well placed to withstand the test of current economic environment.

The largest holding is Avenue Super at ~11%, value retailers actually benefit in such times and being under essential items is not seeing any major adverse impact to its business, in fact is currently benefiting in this environment. We also have ~14% holding in pharma companies like Abbott, Dr Reddy and Eris Life, which again fall under essential items. We also have ~4% holding in PI Industries which supplies to most of the key global agrochemicals company and also fall under the essential items category. As such between these sectors our holding is ~29% which are falling under essential items category and are largely insulated or stand to gain over the next few quarters from all these uncertainties. (These scrips are a part of the portfolio; Data as on 28th Feb, 2020)

Apart from this we have around ~15% weight in insurance companies like HDFC Life, Max and ICICI Life which again stand to gain in longer term from the current environment as awareness for insurance increases. Though in the near term new acquisition could get impacted as bank branches remain shut – the larger revenue pie which comes from policy renewal remains relatively insulated. Hence, we believe that these two buckets (Essential items + Insurance) which account for ~44% of fund remain largely insulated from any such economic shocks. Even in the most impacted segment of financials we have ~25% weight and hold large market leaders like HDFC Bank, Kotak, ICICI Bank and HDFC, where we do not foresee and major negative impact, as they are better positioned to withstand these shocks compared to smaller banks or NBFC’s. RBI measures to defer all term loan EMI’s with a three month moratorium, will ensure that even this highly exposed segment will have enough regulatory cushion to withstand this downturn. As such, almost 70% of our fund is unlikely to witness any major negative impact from this downturn. (These scrips are a part of the portfolio; Data as on 28th Feb, 2020)

Now coming to our fund:
We believe Motilal Oswal Focused 25 Fund, is one of the most unique large cap fund, due to following reasons: 1) Is truly an index and sector agnostic fund – with active portfolio of almost ~67%, 2) Is focused and concentrated fund – with ~23 stocks and high concentration with top 5 stocks accounting for ~42% and top 10 ~70% weight (versus industry average of ~40 stock holding), 3) Is a buy and hold fund with churn rates of ~42% vs industry churn rates of ~80% plus and 4) Has higher flexibility as due to its categorization as focused large cap fund the large and mid cap ratio is 65%:35% vs conventional large cap of 80%: 20%. (Data as on 28th Feb, 2020)

Lastly, none of us can time market bottoms and market bottoms are mostly known in hindsight. Hence, one should not wait for identifying market bottoms. There are good, better and best time for investing, best time or bottom identification is mostly a myth and should not be attempted. Given the sharp market corrections, and the fact that there are many bottom up ideas which provide high investment comfort, I would believe that this is definitely one of the better times to be investing in the markets. For new investors we would suggest investors to stagger it over 2-3 months to be able to best deal with this market volatility.

This article has been issued on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this document is for general purposes only and not a complete disclosure of every material fact. The Stocks mentioned herein is for explaining the concept and shall not be construed as an investment advice to any party. The Stocks mentioned above are used to explain the concept and is for illustration purpose only and should not be used for development or implementation of any investment strategy. It should not be construed as investment advice to any party. The stocks may or may not be part of our schemes. Past performance may or may not be sustained in future. The information / data herein alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy. It should not be construed as investment advice to any party. All opinions, figures, estimates and data included in this article are as on date. The article does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. The statements contained herein may include statements of future expectations and other forward-looking statements that are based on our current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Readers shall be fully responsible/liable for any decision taken on the basis of this article. Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

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