Canara Robeco MF sticks to long-term business fundamentals, says Equities Head

Canara Robeco Mutual Fund focuses on long-term business fundamentals and does not react to short-term market fluctuations, according to Shridatta Bhandwaldar, Head of Equities at the fund house.Explaining the fund’s core investment approach, Bhandwaldar said the team looks for robust, growth-oriented businesses run by competent management and available at a reasonable intrinsic value.

The fund uses a “BMV framework” — Business, Management and Valuation — to assess whether a company fits its investment universe.

When building a portfolio, the fund house focuses on what Bhandwaldar calls “incremental superiority.” This involves tracking how a company’s earnings growth and capital efficiency compare to peers. “By earnings growth, we mean actual cash flow growth, not just accounting profits,” he said.
He pointed out that shorter business cycles and easy access to capital have increased variations in capital efficiency. “We see more capital deviations now, which can either protect capital or open up new opportunities,” he added.On the ongoing growth-versus-value discussion, the fund house maintains a balanced approach but leans towards growth. Bhandwaldar noted that India’s nominal GDP has grown by about 10% annually over the past two decades, which supports a growth-focused stance. The team considers value stocks only when there is a clear catalyst. “We don’t buy stocks just because they appear cheap. There must be a tangible earnings or capital efficiency driver,” he said.

He added that regardless of the investment style, the starting point remains the same: the quality of the business, the capability of its management, and a strong balance sheet.

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