Jain, who exited as CIO of
after 19 long years and was with the fund house for decades, had the unique distinction of being the first Indian fund manager to manage a fund for over 25 years.
The celebrity fund manager had been managing the Balanced Advantage Fund since its inception in 1994. Besides, Jain was India’s first fund manager to oversee Rs 1-lakh-crore worth of equity assets. His parting ways with
AMC has kept social media portals abuzz.
Veteran Nilesh Shah of Kotak AMC, in a tweet, said it is now only that he knows the feeling that spectators and cricket players had when Australian great Donald Bradman announced his retirement.
“A legend, the brand ambassador for the mutual fund industry for decades and a true gentleman. All the very best Prashant bhai.”
Now I know the feeling which spectators/players had when Donald Bradman announced his retirement. A legend, The Br… https://t.co/vii4NZNPWK
— Nilesh Shah (@NileshShah68) 1658488238000
Siddhartha Bhaiya, Fund Manager, Aequitas Investment Consultancy, said managing public money, a fund manager is no way less than being an Indian cricketer, and Jain has been the mutual fund industry’s own Sachin Tendulkar in terms of longevity and consistency amid immense pressure and constant scrutiny.
#prashantjain To someone I have met only once but admired consistentlyA man of impeccable integrity & high ethic… https://t.co/xfROICzeTZ
— Siddhartha Bhaiya (@sidd1307) 1658484908000
Data available with Morningstar suggests that HDFC Balanced Advantage Fund, which Jain had been managing since its inception, delivered a compounded annual growth rate (CAGR) of 17.88 per cent.
The HDFC Top 100 that he was managing since 2003 delivered a CAGR of 19.65 per cent compared with the peer average of 17.22 per cent. Besides, the HDFC Flexi Cap fund that he was managing also outshone peers with a 20.76 per cent return against the peer group average of 18.31 per cent, as per data compiled by Morningstar.
Jain’s investment mantra
In an interview to ET NOW, Kaustubh Belapurkar of Morningstar Investment Adviser explained : “Prashant’s philosophy has always been a bit of a contrarian. He looks for companies that he thinks are reasonably well-managed and have good fundamentals but are going through an element of sort of tough times and he looks to identify them earlier. And what has happened for him is that because of the earlier identification, sometimes he used bear the pain for a little bit before it could really bear fruit.
Belapurkar said companies or segments that Jain could potentially avoid were the companies which are great, where the growth is great, but the valuation was just too expensive.
“He trimmed or gotten out of these positions, including the infrastructure-led companies in 2007. Also, the way he pared his positions in NBFCs in more recent times or some of the auto companies back in 2000 before the 2018 downturn because valuations had become very excessive. It hurt him in the short term, but it paid rich dividends. This valuation conscious bias he is amongst one of the foremost sorts of contrarian value investors that have existed in the Indian market,” Belapurkar said.
Kalpen Parekh of DSP, in a tweet, said: “A few months back, I was on a flight with two role models sitting next to me. Two hours of uninterrupted brilliance flowing around me. Nimesh Shah and Prashant Jain. That seat could have been auctioned at higher prices.”
In another tweet, Shyam Sekhar, Founder, iThought Advisory, recalled his first meeting with Jain at a big HDFC MF event in Chennai.
He recalled: “His previous meeting got extended. He came in a bit late. He began apologising for the delay. A Chennai MFD, arrogant to the core, abused him publicly. Prashant simply kept his cool and showed his class.”
What happens now to HDFC AMC?
The show goes on.
In an interview with ET NOW, Dhirendra Kumar, CEO, Value Research, said HDFC AMC has been able to
through the worst of times, and this is not necessarily the worst of times for the fund’s performance.
“It has made a comeback and has been able to withstand the poor performance for a very long period, simply because there is much more to investors’ experience than just performance,” it said.
Kumar said there is much more to be read and understood about the whole culture bit and Prashant Jain leaving.
“I think the integrity, the conviction and being able to stick around for a period of time and maybe the diversity of the whole hand holding and mentoring of the large team which has come up and it is not a small period, it is nearly 20 years.”
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)