HDFC: Anand Laddha thinks banking and financial stocks may rally

HDFC Mutual is set for a new role into new Banking and Financial Services fund.

HDFC Mutual Fund has announced the launch of the HDFC Banking and Financial Services scheme. The in-charge of this scheme will be under Anand Laddha, who is Fund Manager Equities & Senior Equity Analyst, at HDFC Asset Management Company.

After the second wave of COVID people were concerned about investing into NPAs here’s the response of Mr. Laddha, Over the last 10 years, the banking sector has been amalgamating due to corporate asset, quality challenges and low capital expenditure, which were both behind us. The gross and net NPAs for the banking sector are on a decreasing trend and the provision coverage ratio has moved up to 70 percent-plus levels, it also indicates that the banks have provided a legacy for NPAs and thus provision cost is  to be decline. This has also been under consideration of the banking sector’s results for FY21. The outcome of which is under asset quality during the COVID year and  indicates the underlying strength of the banking system and corporate earnings.

Talkin about the concern with ETF and new banking scheme, Banking ETF consists of banking stocks and is a non-resistance strategy. Besides this, HDFC Banking and Financial Services Fund, is likely to invest in banks, NBFCs, HFCs, and financial services companies. Also the scheme is in operational  strategy and it will choose stocks from  BFSI sector, that includes stocks of large, medium and small-size companies.

Realistically if we see that, it has considered to launching in sector/thematic fund only when we see good investment opportunities. We will try offer a well-diversified investment opportunity and hence we are launching this fund.

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