What to expect from HDFC Bank merged entity? Saurabh Mukherjea answers

economictimes.indiatimes.com:

«Indian Railways is paying suppliers pretty quickly. So, we are trying to assess plays on supplying more to the railways. We are little apprehensive about the elections next year because if there is any change in power in Delhi, there will be a new bunch of people running the railway ministry,» says Saurabh Mukherjea, Marcellus Investment Managers.What are the new additions and what are the subtractions you have done in this market rally because on an average, the gains in large cap stocks are 15%, midcap is 20%, small cap is 25%.Yes, so, I think you are probably right.

This fiscal our large cap portfolios are up something 17-18%, our midcap portfolios are up 15-16%. Main addition we made is around three months ago, we bought Metropolis Healthcare in our small cap portfolio. We believe that the whole funding boom, the private equity and venture capital pumped in money into startup, pathlab companies, that I think is behind us.

And Dr Lal and Metropolis therefore should well placed to benefit from the hike in prices again in the pathlab sector. Barring that, we have not made any massive investments. We are contemplating a couple more changes to two of our larger portfolios, but we have not made any massive changes.

Our portfolio churn is very low 10% to 15%. We stay invested in companies for eight-nine years and therefore, we only invest in new ideas every say five-six months.I would like to draw your attention to two themes which in a sense are toast of the town. One is railways and second is defence. Now, these are not great businesses. The return on equity, return on capital for both defence and even railway companies would be in mid-teens but these are businesses where you can see the order book visibility, the onus