In the month of March, we delivered an outperformance of 1.26% through proactive sector allocation and focused stock selection, compared to Nifty’s 6.31% and the ITUS Fund’s 7.57%.
India’s exports to the US account for approximately 2% (USD 80 billion) of our USD 4 trillion economy, with net exports standing at USD 40 billion, or about 1% of GDP. Our total exports amount to around USD 800 billion. Tariffs imposed on India are comparatively lower than those on most of our competitors. We believe that the current environment is likely to create volatility in the short term. However, once settles, the ongoing tariff crisis may ultimately prove to be a net positive for India, even if it leads to a global slowdown. Additionally, India’s Current Account Deficit is under 1.5% of GDP, the Fiscal Deficit is well under control, and inflation is effectively managed.
Those who have been consistently following our weekly updates are already aware that we made timely and strategic reallocations across sectors. Specifically, we reduced our exposure to pharma (though not a complete exit) and infrastructure and IT, while increasing our allocation to banking and selecting other sectors in line with evolving market conditions.
ITUS Fund Valuation
Currently, the ITUS Fund’s price-to-earnings (PE) ratio stands at 30.6, compared to the Nifty’s PE of 21.4. At first glance, this may suggest that we have chosen relatively overvalued stocks. However, it’s important to consider the PEG ratio—popularized by renowned fund manager and author Peter Lynch.
This indicates that despite being a multicap fund, we have successfully selected value stocks that are on a strong growth trajectory.
Outlook: We firmly believe that our approach of proactive sector rotation and identifying value stocks in growth segments will continue to help us outperform across various market situations. This uncertainty presents a great opportunity—much like the COVID crisis—for investing.
Keep following us for more contents like these. As always, we keep re-emphasising our SIP mode of investment. You can connect with your relationship manager to know more about our SIP Program.
These weekly episodes are now available in our website for your quick read and you may access the same in the below link.
Weekly Enlightenment Archives – ITUS Capital