Mr. Manish Gunwan

CIO – Equity Investments

Reliance AMC

Manish graduated from IIT Chennai with a B.Tech and has a Post Graduate Diploma in Management from IIM Bangalore. Manish has 21 years of work experience primarily in equities spanning roles in equity research and fund management. He has also co-founded a technology company in the document management space.

During his stint at ICICI Prudential AMC, he managed two flagship funds of the mutual fund whose assets grew from $1bn to $5bn in 5 years. One of the funds grew from $50m to $3bn becoming the second largest fund in the industry. As deputy CIO he was instrumental in various aspects of asset management including setting up research processes, product strategy, developing talent of the team etc.

Manish has immense experience in equity research and has also spent two years working in a portfolio management company whose focus was midcaps. Having traveled extensively across the world, Manish has attended many global investment conferences and seminars.

Q. What is your overall impression from the Union Budget? How would you rate it?

Answer: We believe the budget had a good balance between stability (sticking to fiscal deficit target broadly) and stimulus (expected in an election year but done with sharp focus and restricted outlays). Overall we think the space for fiscal stimulus to revive the economy is limited and going forward monetary policy may be more important in this context. We would hence give the budget a high rating.

Q. Income support has been a big idea and a structural shift away from subsidies and waivers. What is your take on same?

Answer: We think that income support is a better measure than subsidies and waivers as the latter tends to distort the market economics of the goods and services involved. For instance the urea subsidy seems to be affecting soil quality through over use of urea. However it needs to be ensured that the income support infrastructure in terms of accessibility of bank accounts, list of beneficiaries etc. is robust.

Q. Please share the top couple of budget proposals which you did not like or were missed altogether?

Answer: Couple of concerns on the budget are:

  • Using funds from divestment heavily is structurally not advisable as these revenues are to a certain extent non-recurring, especially given that the government stakes in quite a few PSUs are close to the minimum shareholding required to retain controlling stake. Ideally the divestment revenues should be dropping from hereon
  • Estimates on certain items like GST revenues, PSU dividends etc. are quite aggressive

Q. Many investors are likely sitting on the edge, awaiting election results before committing big money. What would be your piece of advice to them?

Answer: Historically the evidence is that elections have not swayed the medium to long term trajectory of either the economy or markets too much. While it is an important event, there are many factors which influence the market like interest rates, global growth, commodity prices etc. so one should not put too much emphasis on any one factor. Long term it is advisable to just stick to a disciplined asset allocation which follows valuation of the asset and its risk profile.


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