In hindsight, it seems I timed things quite well,” quips Rajeev Thakkar, the soft-spoken, low-key CIO of Parag Parikh Financial Advisory Services (PPFAS) Mutual Fund. He ranks fifth in the five-year category, in the annual best fund manager ranking compiled by Outlook Business-Value Research. Thakkar has generated compounded return of 10.66%, managing assets worth Rs.24.24 billion as of December 31, 2019. But he plays it down saying, “The growth percentage looks high since our base is very, very low… Our equity fund is roughly Rs.27 billion today and our liquid fund included, we are at Rs.31 billion. In a Rs.27 trillion AUM (assets under management) industry, we are a rounding error.”
Thakkar has come a long way having bought LIC HF at Rs.22 during his college days. With a dividend yield of Rs.2, he felt it was a no-brainer. He graduated in 1992, the year when Harshad Mehta’s ‘crazy bull run’ peaked. Three years later, he completed his chartered accountancy. He believes it was the perfect time to be in the trade, when foreign bankers were quitting their jobs to set up investment banks. He feels he has been ‘lucky’ several times — his stint at then hot investment outfit Prime Securities in 1994, handling government bonds in 1997 when it was popular, and moving to equities fulltime in 2003, the “perfect time for it”. Today, he is that rare brand of investor, leading a portfolio covering both Indian and foreign stocks in one scheme. It is a focused portfolio of 25 stocks, in line with his mentor and value investor Chandrakant Sampat’s philosophy of investing in a few quality companies while keeping one’s expenses low.
While sifting through foreign stocks, he evaluates the trade-off between the global parent and the Indian subsidiary. For instance, he chose to stay invested in Suzuki Corp in Japan while selling off Maruti Suzuki in India last year, right before its stock price slumped for a while due to decreasing demand. He says that Indian consumer companies have been trading at high multiples, at valuations that have little to do with a company’s past or market potential. It is entirely