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Wednesday, 26 September 2018

Aditya Birla SunLife Short Term

Aditya Birla SunLife Short Term Investment Strategy

Maneesh Dangi heads the fixed income team at Aditya Birla Sun Life AMC and is also the co-CIO at the AMC. He has 15+ years of experience in research and fund management and has been with Aditya BSL AMC since 2006. Dangi is an experienced portfolio manager and we view his in-depth understanding of the macro-economy as being an advantage. The fund house runs one of the largest teams on the Fixed Income side, consisting of a 12-member analyst team. This includes four portfolio managers who also double up as analysts. Analysts too take on dual/multiple roles based on their expertise. The fund typically invests in high quality debt papers and has not taken active credit bets in the past. The issuer-selection process on the corporate bond side is extremely detailed and based on a well defined set of processes. The team relies on their internal ratings and processes as opposed to external credit rating agencies. Given their focus on quality and liquidity, analysts tend to undertake an in-depth evaluation of the management, corporate governance practices, financial standing of the issuers, liquidity, and risk.

Overall, the investment process seems robust, given the manager's focus on conducting competitor analysis, scenario analysis, and client profiling that form important aspects of the process. The core of the strategy lies in a combination of taking a duration view based on the interest rate directional movements and taking some credit bets in high quality corporate bonds at the shorter end of the yield curve. In line with its philosophy, the strategy allocates a portion of its assets to G-Secs and State Development Loans (SDL) in addition to investing in high quality debt papers. Dangi can vary his allocation towards these based on their valuations and relative spreads. The execution of the strategy is reflected in the fund's noteworthy performance. The fund has remained a consistent performer over the years.




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