Mark Mobius, executive chairman of Templeton Emerging Markets Group in an interview to Bloomberg Quint said that he is bullish on Indian smallcap companies and believes that they are likely to climb after trailing the rally in the biggest shares as benefits from Prime Minister Narendra Modi’s growth-boosting measures take hold.
So far this calendar year, the BSE Smallcap index tumbled nearly 5 per cent to 11,381.03 on June 8 from 11,940.75 on January 1. However, the BSE Sensex gained 3.28 per cent to 27020.66 from 26160.90 during the same period.
Mobius further added that if you factor in the reforms that are taking place and the impact they can have on company earnings, it tells us that India is on the cusp of an interesting opportunity.
Even as Mark Mobius is positive on Indian smallcap stocks we look at holdings of Templeton’s Indian arm Franklin Templeton Mutual Fund, which includes Franklin India Smaller Companies Fund. The fund has 71 stocks in its portfolio.
As on May 31, 2016, the top holdings in the fund includes stocks such as Equitas Holdings, Finolex Cables, YES Bank, eClerx Services, FAG Bearings India, Repco Home Finance, Voltas, Atul, Tata Motors DVR, Finolex Industries, Karur Vysya Bank, Gulf Oil Lubricants India, IndusInd Bank, The Ramco Cements, Gujarat Pipavav and Axis Bank, according to the data available with Value Research.
Some other stocks the fund holds are Greaves Cotton, Lakshmi Machine Works, SKF India, Deepak Nitrite, TV Today, Amara Raja Batteries, HT Media, NIIT Technologies.
Franklin also has another mid-and-smallcap focused fund — Franklin India Prima Fund. As on March 31, 2016, the fund were holding stocks such as Bata India, Coromandel International, Repco Home Finance, FAG Bearings, City Union Bank and eClerx.