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| HPCL and Bhel are market favourites now. What kind of contrarian view do you have about them? |
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| With the government's renewed thrust on disinvestment after the stupendous response it received for the Maruti IPO, we expect the process for disinvestment of HPCL to gather steam. |
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| With most international oil and gas majors evincing interest in the stock, it has scope for further appreciation. We are positive on the medium-term growth prospects of Bhel as both its power and industry divisions have strong orderbook positions. |
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| The order inflow in FY04 will be on a par with that of FY03. Bhel is ideally placed to leverage the huge capacity expansion planned by NTPC over the next few years. |
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| The company has substantially improved its working capital management, has no debt and trades at very attractive valuations. The passage of the Elecricity Reforms Bill is positive for the sector as a whole and Bhel in particular. |
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| Your highest holdings are in the auto sector. What kind of growth do you envisage here? |
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| We bought into the auto sector around two years ago. Telco, Mahindra & Mahindra and Bajaj Auto had compelling structural improvement stories, be it aggressive cost reductions, quality improvement and new product launch initiatives. |
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| As these companies became lean in their cost structures and lowered their operating break-even volumes, any improvement in volumes was bound to have disproportionate impact on profits. |
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| The secular upturn in volumes that we saw in commercial vehicles, motorcycles and utility vehicles propelled the bottomline growth of these companies. We continue to be positive on them. |
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| Mid-caps are surging past large-caps. Do you intend to increase exposure to mid-caps, moving away from most of the large-caps that Contra holds? |
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| The fund follows a rigorous bottom-up approach for investments. It holds a balanced mix of large-cap and mid-cap stocks. |
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| Currently, it has holdings in several mid-cap stocks like Tata Chemicals, Balrampur Chini, Indian Rayon and Praj Industries. |
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| Which sectors do you expect to be in the limelight? |
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| Automobiles, cement and steel. |
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