While JP Morgan AMC is big globally, your fund house has not grown in India. Why?

When we came in May 2007, we got the first 6-9 months of bullish market but after that the global financial market turmoil unfolded and there were a host of changes in the regulatory environment. In September 2010, we were little short of Rs 10,000 crore AUM and then the massive liquidity tightness happened. We had our share of reasons. Our internal policies being so strict also resulted into a sluggish growth when the fixed maturity plans (FMPs) took off. However, I think the last 18 months have been very satisfying for us as we have grown in a period when the industry has contracted. I would like to build on this and move forward. Also our Greater China and ASEAN Funds have performed much better in the face of the domestic market performance and that’s a success story.

And what growth strategies will you adopt?

I am looking to bring our international funds here and look at at least three launches this year. The first launch will be in this quarter. That’s our strength because it comes on the back of our large international equity size and the track record of those funds. On the fixed income front, India has opened up in terms of quota and we have the space on the infrastructure debt fund side. I already have the distribution capability abroad and have the strength internationally to invest money in domestic market. So this is something that we are working on and we are working with the regulators to simplify on the KYC front. We expect clarification from Sebi in some time in this regard. This is going to be a big space for us. And on the domestic equity front we are focussing on the SIP segment.

While there are various products strategies, how will you push them to investors?

We will go with debt then hybrid and then pure equity in line with the RBI rate cuts. While the rate cuts are on cards over the next 12-18 months, we are building our debt funds as we see a big opportunity there. When the RBI is in the midst of rate cut, the equity markets will start looking up and then we will focus on hybrid, followed by pure equity. In the meantime we will continue with global equity and continue with SIP focus on equity side.

What is your view on equity markets?

While we have seen the worst of FII flows, fall in valuations and policy inaction for a long period, there now seems to be willingness on the part of the government to take tough decisions. Also while the earnings expectations have fallen from 20-25 per cent to 10-12 per cent, corporates can surprise positively on the earnings side. So if you invest in SIPs, you will to benefit from a market that is stagnating but looking to go into higher trajectory in 12-24 months. There are plenty of stocks which are very attractively valued.

When do you see the earnings surprise to happen and what is your expectation of GDP and earnings growth rate?

I think it is two quarters away as RBI will take 1-2 quarters before it substantially eases and that starts translating to Corporate India. GDP growth for FY’13 is expected at 7 per cent on the back of better performance in the second half while FY’12 should also end at 7 per cent. Earning growth for Sensex companies in the second half of FY’13 should be between 18 per cent and 20 per cent.

What is the fund house’s view on European crisis?