Rajiv Jain, founder, GQG Companions

Funding agency GQG Companions’ founder Rajiv Jain thinks PSU shares, a lot of which have hit file excessive in current days, are a lovely funding attributable to improved administration and robust long-term progress prospects.

The efficiency of PSU shares, typically derisively known as wealth destructors, has been making a buzz, producing wealthy returns for buyers. The BSE PSU index has surged over 21 %, to date, this yr towards a mere 1 % rise within the benchmark Sensex.

Jain, who stunned the market by choosing stakes in Adani group of firms when they have been hammered within the aftermath of Hindenburg Analysis report, regrets not shopping for shares of state-run Life Insurance coverage Company (LIC) in early 2023 attributable to restricted liquidity.

“We’d have liked to purchase LIC early final yr, however we couldn’t discover any blocks,” he mentioned in an unique dialog to CNBC-TV18.

LIC is amongst a number of PSU firms with low public float. The federal government maintains a 96.5 % stake within the insurance coverage behemoth, having divested solely 3.5 % fairness in India’s largest IPO up to now.

ALSO READ: MF share in PSU shares scales recent file excessive of seven.58% in Jan

GQG Companions holds positions in India’s largest lender, State Financial institution of India (SBI), and energy utility NTPC and stays optimistic about their long-term prospects.

“Within the case of NTPC, the present administration is doing a greater job in comparison with the previous as many competent folks have been employed. Furthermore, the efficiency has improved as they get much less intervention from Delhi, which was a continual drawback earlier,” he added.

ALSO READ: PSU Financial institution index: Is it on track to hit new highs?

Mutual funds (MFs), too, raised stakes in PSU companies to a file excessive of seven.58 % of complete property underneath administration in January, up from 5.72 % from a year-ago interval and seven.24 % from the earlier month.

The market worth of MF holdings in PSUs has additionally seen a big rise, surpassing Rs 4 lakh crore in January from Rs 2.33 lakh crore a yr in the past and Rs 3.7 lakh crore final month.

Disclaimer: The views and funding suggestions expressed by funding consultants on Moneycontrol.com are their very own and never these of the web site or its administration. Moneycontrol.com advises customers to examine with licensed consultants earlier than taking any funding selections.

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