After large-cap switch last year, Quant MF's Sandeep Tandon starts to add small-caps
MUMBAI
:
Sandeep Tandon, 55, founder and chief investment officer of Quant Mutual Fund, has started seeing opportunities in small caps even as he stays cautious about mid-caps, about 10 months after his asset management company moved towards large-caps amid 'risk-off' conditions.
'We are seeing a minor risk-on environment now,"
said Tandon, whose firm manages close to
₹
90,000 crore in investor assets. Quant Small Cap Fund is the largest scheme for the fund house with assets of around
₹
26,000 crore.
His own equity portfolio has 60% exposure to large-caps, 15% to mid-caps and 25% to small-caps, Tandon said in an interaction with
Mint
on 'Guru Portfolio', a series whereleaders from the financial services industry share how they manage their money.
Tandon, who is bullish on small-caps for the long term, has allocated more towards large-caps over the past year. He moved out of mid- and small-caps around July last year as Quant's data-driven investment model signalled a risk-off period.
His allocation last year was as follows: 27% to small-caps, 23% to mid-caps and 50% to large-caps. However, over the past three months, Tandon has been seeing 'a minor risk-on environment" and more opportunities in the small-cap segment as stock prices have corrected sharply, but he still remains more cautious on mid-caps.
All of Tandon's personal investments are managed through Quant Mutual Fund's schemes, and portfolio changes influence his own allocation.
About 75% of his portfolio is allocated to equities, 15% is in real estate and the remaining 10% is in liquid funds for any contingencies. He doesn't see real estate holdings as an investment as these properties are family-owned for residential and office use.
While Tandon's equity allocation was 60% last year, but his incremental stock investments went up from 50% to 75% over the past five years amid the stock market rally.
While his portfolio has delivered negative returns of 2-3% over the past year, the five-year average annualized returns stand at 35%.
Unlike the traditional buy-and-hold style, Tandon says his funds follow 'short-, medium-, long- and even investments with decadal view".
He cites the example of Japan. After 1989, the Japanese markets didn't touch new highs till 2024. 'So, for the better part of three decades, if the investor had just stayed long-term, he or she would have got index-like returns," Tandon said. 'Investors always chase alpha (outperformance vs alpha) regardless of the market cycle, which is possible if certain investments are looking to capture short-term opportunities."
Quant's data analytics model has been built over the years and follows the valuation, liquidity, risk appetite and timing analytics or the VLRT framework. For example, when both risk appetite and liquidity are at elevated levels in the markets, the investments can be more aggressive.
Tandon's interest in quantifying market dynamics stems from his early experience in the
badla
market, which for several years was India's indigenous derivatives market before the futures & options (F&O) segment was introduced in early 2000s.
'It was possible to reverse calculate the
badla
rate to decode the mood of the market. That's the reason I always talk about market-implied analytics," Tandon said. 'The genesis of market-implied analytics actually comes from the
badla
market."
Tandon prefers equities over real estate. 'There used to be that mindset that, as soon as you get your first savings, you should start building a house. In those early days, I took a loan to purchase my first house. Then, as a family, we bought a couple of more houses," he said. 'However, if I had used those funds to invest in equities, the wealth creation would have been much larger."
Tandon doesn't keep a contingency fund separately as he maintains 10% of his allocation in liquid funds.
He doesn't believe that one needs to be 100% invested in markets all the time. 'In any case, I have a very large holding in equities. The liquid fund allocation gives me a psychological comfort," Tandon said. On life insurance and health cover, he says he has been adequately covered by his company.
Tandon doesn't plan to retire anytime soon. 'I don't like to think of retirement as it has negative connotations for me," he said. 'I believe in working till the last day of life. When you think like that, your involvement will be on the higher side, your reflexes will be on the higher side. The mental agility remains intact."
He has not planned any separate retirement corpus. All his investments can be easily liquidated as and when he requires them.
Markets are about cycles, according to Tandon. 'Nobody can identify the exact trough or crest of the market. Something has changed for India. Our perception analytics says that India's perception has changed, which means any valuation multiple can remain elevated for a longer period of time," he said. 'Recently, too, we saw this play out. Since 2022-2023, people have been saying markets are expensive, but markets have still rallied from those levels till as late as September 2024."
'We have to live with the reality that India is buy-on-dip. Structurally, something has changed. So, India's long-term growth story remains intact, despite the tariff noise that is playing out. In absolute and relative terms, India can be a big beneficiary. India is the only country in Asia that can come close to offering the scale of China, if the US wants to reduce its reliance on China," he said.
His passion for analytics drives him, keeping his energy levels high, said Tandon. 'If you like something, you always find the energy to pursue it." Apart from that, he likes to read. He also listens to podcasts if he finds time or whenever he takes his walks. 'I also like to listen to music to unwind."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
5 hours ago
- Time of India
Bengaluru's hotel kitchens turn to machines for south Indian fare
Bengaluru: From soft idlis to crispy vadas, south Indian cuisine has always hinged on precision and a practised hand. But as the appetite for south Indian fare surges and skilled cooks grow scarce, Bengaluru's hotel kitchens are quietly adapting — by bringing machines into the masala. The city's hospitality sector is already seeing machines roll out vadas and stir up steaming pots of pongal. Yet, industry veterans say, full automation remains out of reach — especially for food steeped in regional heritage and family recipes passed down over generations. "South Indian cooks are particularly hard to find," PC Rao, honorary president of the Bangalore Hotels Association (BHA), said recently at the launch of the Media Day Marketing trade expo where equipment firms showcased new tools for the hospitality sector. "We have vada-making machines and pongal systems, but someone still needs to measure and feed the ingredients. It's not yet 100% mechanised," Rao said. Demand for bulk-catering solutions is driving part of this change and BHA president Subrahmanya Holla said machines are helpful where quantity matters. "We use pongal machines in large setups. Vada-making too is easier when it is automated. But not everything can be handed over to the machine. In a Mysore Pak production line we visited recently, there was still the need for a human hand to pour ghee and sugar at the right moment," Holla said. At Konark Hotel, one of Bengaluru's long-standing establishments, owner K Rama Murthy has implemented high-tech combi-ovens that use steam and dry heat to prepare dishes like bisibele bath, pongal, and pulao. "We can even roast masalas in it. But for shallow-frying, or making sambar and masala dosa, the machine has its limits," he said. Murthy, with over four decades in the industry, pointed to the difficulty in fully codifying south Indian culinary knowledge. "It's generational wisdom. You can't just put it in a syllabus," he said, adding that Indian food is typically made-to-order, unlike standardised continental or fast-food options. Some kitchens are also experimenting with advanced food technology such as freeze-drying or vacuum-packing to extend shelf life and preserve nutrition, but such methods remain costly. Impact on hospitality edu Meanwhile, hospitality schools are recalibrating their curriculum. At IIHM Bengaluru, students are now being trained on artificial intelligence-driven systems. "AI is streamlining kitchen operations — from menu planning to stock-taking," said Sanchari Chowdhury, the institute's director. "In fact, a Japanese restaurant here uses technology to remember diners' preferences—where they sit, what they order," Chowdhury, who believes Bengaluru's tech-savvy mindset gives it an edge, Sanchari said. She, however, added: "We have already replaced key cards with mobile check-ins. But even as roles evolve, the warm human presence is still crucial in hospitality."
Time of India
6 hours ago
- Time of India
Japanese shipping firm plans to start container services from Mormugao port
Panaji: At least three shipping lines, including the Japanese shipping firm Ocean Network Express (ONE), expressed interest in commencing container movement at Mormugao port after the monsoon. Additionally, Delta Ports, which handles operations at Berth No 10 and 11 of Mormugao port, is in active discussions with Shipping Corporation of India (SCI) to include Goa in the SMILE (SCI-Middle-East-India-Liner-Express) service. ONE's senior management team, led by its managing director Masahiro Sakikubo, undertook a comprehensive terminal tour of Mormugao port on Monday to assess the terminal's container-handling infrastructure. ONE is jointly owned by the Japanese shipping lines Nippon Yusen Kaisha, Mitsui OSK Lines, and K Line. 'This is a major milestone where a global liner has entrusted us and visited Goa for restarting the container services. ONE's management showed keen interest in the ongoing developments at Delta port's Mormugao Terminal Private Limited, particularly regarding the resumption of container services. Our consistent efforts and engagement with stakeholders led to their first-hand visit, offering an encouraging outlook for Goa Port's future,' said an official of Delta Ports. ONE, currently ranked fifth in the global container trade, operates a fleet of over 260 vessels with a capacity exceeding 2 million TEU. MPA chairperson N Vinodkumar assured ONE of the port's full support, along with incentives to facilitate the commencement of container trade. Encouragingly, Unifeeder, another logistics firm, is currently studying the feasibility of including Goa in its container network, engaging with leading shipping lines like CMA CGM, ONE, Maersk, MSC, and HMM to ship container cargo post-monsoon. Port officials said that the inclusion of Mormugao port in the SCI's SMILE network will reduce road transport dependency and support cargo movement for salt, industrial salt, tiles, bentonite, and manufactured goods, benefitting local industries. 'Goa's exporters and importers will soon enjoy seamless global connectivity from their hometown port. "This initiative will particularly empower MSMEs, enabling them to compete confidently in international markets without the burden of high logistics costs,' said an MPA official.
India.com
10 hours ago
- India.com
Meet Noel Tata's glamorous bahu who is heir to Rs 134880000000 business empire, Ratan Tata was her…, her name is...
Meet Noel Tata's glamorous bahu who is heir to Rs 134880000000 business empire, Ratan Tata was her…, her name is... Following the death of Ratan Tata, Noel Tata was designated by the trustees as the new Chairman of Tata Trusts on October 11, 2024. This designation attracted much public scrutiny, with many inquiring about Noel Tata and taking to the internet to learn more about him. More curiosity grew on the internet about Noel Tata's background, education, and family. Interest grew around Noel's wife, Aloo Mistry, and her brother, Cyrus Mistry, especially in light of their past grievances with Ratan Tata. With this transition in leadership, the Tata family has been a topic of conversation once again. Meet Noel Tata's glamorous bahu who is heir to Rs 134880000000 business empire Noel Tata, a prominent member of the Tata family, has three children: Leah, Maya, and Neville Tata. The youngest of the three, Neville Tata, is a graduate from the Bayes Business School and is following in the footsteps of two of India's most prominent business families. Manasi Kirloskar is married to… Neville is married to Manasi Kirloskar, a dynamic business leader from the Kirloskar Group. Born on August 7, 1990, Manasi stepped into leadership after the sudden demise of her father, Vikram Kirloskar, who passed away from a heart attack at the age of 64. In November 2022, she was appointed Chairperson of Kirloskar Joint Venture Private Limited, one of the most important company members of the 130-year-old Kirloskar Group, worth ₹13,844 crore at present. Manasi Kirloskar is the daughter-in-law of Noel Tata and Aloo Mistry and thus connected to both the Tata and Kirloskar legacies of industrialists. Aloo Mistry is also the sister of Cyrus Mistry, the former chairman of the Tata Group who passed away recently. Manasi got her education from the Rhode Island School of Design in the USA, where she earned her Fine Arts degree. Manasi is married to Neville Tata, and they have two children, linking the legacies of two of India's influential business families. Manasi Kirloskar is related to Cyrus Mistry! 'Ms Manasi Tata, a graduate from the Rhode Island School of Design in the US, is well conversant in Toyota manufacturing processes and with the Japanese work culture. A fifth-generation scion of the Kirloskar empire, Ms. Manasi holds art very close to her heart and her NGO, 'Caring with Colour' leverages this passion of hers, works with Government schools in three districts of Karnataka,' reads the statement on the website of Toyotabharat. Manasi Kirloskar's mother, Geetanjali Kirloskar, serves as the Chairman and Managing Director of Kirloskar Systems Private Limited. Manasi, following her mother, has established her own path in business and in the arts. A gifted painter, she presented her first art exhibition at the age of 13. In addition to her business and creative endeavors, Manasi enjoys swimming. In addition to being an accomplished businesswoman in the capacity of head of Toyota Kirloskar Motor and Toyota Kirloskar Auto Parts, Manasi Kirloskar is well known for her sophisticated style and for being present in social and fashion circles. Noel Tata is the half-brother of Ratan Tata, having the same father, Naval Tata. Manasi Kirloskar is married to Neville Tata, who is Noel Tata's son, making Manasi Noel's daughter-in-law. While Manasi is now part of the Tata family, she does not have a direct familial connection with Ratan Tata other than being related to the extended Tata family.
