Mr. Mahendra Kumar Jajoo

Chief Investment Officer - Fixed Income, Mirae Asset Mutual Fund

Mr. Mahendra Kumar Jajoo is responsible for managing fixed income assets across all products. He has over 31 years of experience in the field of financial services including 17 years of experience in Fixed Income funds management.

He is overall responsible for supervising all Debt schemes of the Mirae Asset Investment Managers (India) Private Limited.

In his prior assignment, he has been associated with organizations like Pramerica Asset Managers Pvt. Ltd., Tata Asset Management Ltd., ABN AMRO Asset Management Ltd and ICICI Group.

Mr. Jajoo manages Mirae Asset Aggressive Hybrid Fund, Mirae Asset Balanced Advantage Fund, Mirae Asset Equity Savings Fund & Mirae Asset Nifty SDL Jun 2028 Index Fund.

Q1. The RBI has kept the repo rate unchanged, as widely expected, even as inflation projections have softened and global uncertainties-like new tariff threats and evolving Fed policy-persist. How do you interpret the central bank’s stance, and what signals should investors be watching from both the RBI and the US Fed in the months ahead?

Ans: RBI indicates that the current fall in inflation is already factored in it front loaded 50bps rate cut in June. While domestic factors suggest scope for incremental rate cuts in India, the global factors are somewhat uncertain.

Fed is also concerned with tariff related inflation and steeper yield curve with dwindling demand for US treasuries.

Investors may watch for any change in stance on these issues by the respective banks.

Q2. Beyond the RBI's policy, what are the key domestic and global macroeconomic trends that you believe are currently shaping the Indian bond markets? Where do you see the most significant tailwinds and headwinds?

Ans: Dwindling demand for US govt bonds is the most significant headwind for now for Indian bonds, not allowing further fall. RBI has already frontloaded rate cuts and has injected massive liquidity in the system recently. Further, domestic macro remains supportive for lower rates providing tailwinds.

Q3. How do you define your investment philosophy as a fund manager, and how has your strategy evolved over the past 12–18 months?

Ans: At Mirae, FMs keep analyzing the evolving scenario on a continuous basis and construct portfolio in line with the expected market outlook and the fund’s investment objectives. If the rates outlook is positive, FMs would likely be overweight and vice-versa. The strategy has worked well and is inherently dynamic.

Q4. What role can target maturity funds (TMFs) play in an investor’s portfolio today, especially in light of expected stability or mild downward movement in rates?

Ans: TMFs is a product, closest to an FD but with very significant additional advantage for the investors. It offers for all practical purposes a free put option to the investors. That’s to say, if the market is adverse, the investor can hold the investments like any other FD/FMP without much fear of any terminal capital loss. However, if the market is favorable, investor may cash out capital gains at a time of his choosing.

Q5. Geopolitical tensions globally have often pushed investors toward the safety of bonds. Are you seeing any such shift in sentiment or flows toward Indian fixed income assets?

Ans: At the moment, markets seem to price in the confidence that the ongoing geopolitical tensions would dissolve eventually without much negative impact. At this point, one has not seen any defensive shift towards fixed income

Q6. In the current environment of macro uncertainty, what broad investment strategy would you advise for debt mutual fund investors-especially those in low- to moderate-risk profiles?

Ans: Follow an accrual-oriented strategy for now. The best time for duration strategy has just crossed behind. Money market curve is relatively steep offering options in the low duration and money market category

Note: Views provided above are based on information in the public domain and subject to change. Investors are requested to consult their mutual fund distributor for any investment decisions.

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Please note we have published the answers as it is received from the Fund Manager of Mirae Asset.

Mr. Shreyash Devalkar

Head - Equity, Axis Mutual Fund

With a rich experience of over two decades in the equity markets, Shreyash Devalkar is the Head – Equity at Axis AMC. He joined in 2016 as a Fund Manager and was elevated to the role in 2023. He manages some of the flagship funds at Axis AMC such as the Axis Bluechip Fund, Axis Midcap Fund, Axis ELSS Tax Saver Fund, Axis Growth Opportunities Fund, and a few more.

Prior to joining Axis AMC, he was associated with BNP Paribas AMC as a Fund Manager for more than 5 years. He has also worked as a Research Analyst at IDFC Asset Management Company (July 2008 to Jan 2011) and IDFC Securities (Sept 2005 to July 2008).

Qualification:- Chemical Engineering from UDCT, MMS Finance from JBIMS

Q1. How do you interpret the current domestic macro tailwinds in the context of ongoing global uncertainties? In your view, how is the market navigating and balancing these contrasting forces?

Ans:- In the last 3-4 months, we have witnessed markets post a sharp recovery with returns ranging above 18%-25%. FIIs returning to equities, consistent inflows from DIIs, relatively attractive valuations were the key reasons for the surge in equities. The triggers going ahead will be how the tariff scenario unfolds for India on relative basis compared to competing countries in respective goods and the ongoing earnings season. If we look at the macro factors, we stand supported by surplus liquidity and lower interest rates, our twin deficits are in control, inflation is well below RBI’s target and growth seems reasonable. Stability in currency and low inflation may offer some room for further rate cut.

Q2. With the June quarter earnings season now underway, how do you assess the performance outlook for India Inc. this quarter?

Ans:- We believe that this quarter could be in line with expectations, because earnings expectation are already cut across. Overall, the growth is still expected to be in single digits. At a sector level, banks may face a drag from NIMS given falling interest rates, automobile sector is expected to stay subdued while the pharma segment could report decent growth. Consumption companies have been a pain point however going forward this could improve if consumption rebounds. Industrials and manufacturing could do better than market expectations.

Q3. Foreign institutional investors haven’t fully returned to Indian markets yet - in your view, is it valuations or earnings that are holding them back?

Ans:- It’s a combination of two things. Higher valuations led to FIIs moving back and returning when valuations turned better, and interest rate differential compared to US. Although not out of the woods, earnings selectively may turn out to be better than expected. We believe markets are in a phase where we could see some fair amount of volatility and push and pullback from the FIIs.

Q4. We've seen a surge in new products, categories, and investment avenues. Has this led to a ‘problem of plenty’ for investors? And could passive investing offer a way to simplify decision-making?

Ans:- We believe that different investors have different choices, some choose active funds for the alpha, while other may want to just invest in passive funds for their simplicity. As markets mature, new opportunities arise and I believe investors should explore new avenues of investing. Spreading assets across products, categories and avenues can provide investors an immense wealth creation journey.

Q5. How should investors position themselves in the small and mid-cap segment? Are we seeing a meaningful improvement in profitability relative to large caps based on current data?

Ans:- Although large-cap stocks have gained favor in recent months following the sharp correction, I always believe in being invested across the market capitalisation. Many large-cap companies have shown relatively modest growth in the current cycle, making their valuations more reasonable compared to pre-COVID levels. On the other hand, sectors such as defense, power capex, tourism, and EMS are experiencing strong growth, but valuations in these areas are quite elevated. These themes are more prominently represented in mid- and small-cap segments. Therefore, it’s advisable for investors to stay invested across the market cap spectrum. However, stock selection remains critical-simply allocating across asset classes may not be enough to generate superior returns.

Q6. As a fund manager, how do you determine the right time to exit a sector-especially when it remains in favour but the fundamentals appear to be weakening?

Ans:- When fundamentals are weakening on relative basis - both in the context of valuations and compared to other sectors, it is generally time to reduce exposure, we follow this principal across market cycles.

Please note we have published the answers as it is received from the Fund Manager of Axis.

Mr. Devang Shah

Head – Fixed Income India, Axis Mutual Fund

Devang Shah is the Head of Fixed Income at Axis AMC. He joined the fund house in 2012 as a Fund Manager and was elevated to the position of Head – Fixed Income in 2024.

He has over two decades of industry experience of which, 18 years have been spent in the Mutual Fund industry. His core responsibilities include managing top quartile performance for all Fixed Income Funds & managing client relationship. Additionally, he has been actively involved in ideation and determining the investment strategy for fixed income funds.

Prior to joining Axis AMC, he was associated with ICICI Prudential AMC (2008-2012) as a Fund Manager and was also the head of credit. He has also worked with Deutsche AMC and PwC.

Educational Qualification: B.Com from Mumbai University and a Gold Medallist in Financial Management, Associate Member of ICAI

Q1. Given rising global uncertainty-from the Israel-Iran tensions to the ongoing Russia-Ukraine war-how should fixed income investors position themselves to manage risks around global inflation, volatile oil prices, and shifts in safe-haven flows?

Ans: Geopolitical conflicts have been on the rise in the last few years. The unfortunate part is one cannot control these external risks. This is where investors can diversify their asset allocation and participate in fixed income funds. The start of the rate cycle proved beneficial for long duration funds. However, I believe now is the time to participate in short term funds and these can outperform long bonds from risk risk-reward perspective due to a shallow rate cut cycle, lower OMO purchases in the second half of the year and a shift in focus to Govt Debt to GDP targets.

Q2. With the RBI’s recent 50 bps rate cut, how do you interpret the central bank’s message to the market? Do you see this move as a pre-emptive easing to support growth, and how might it reshape fixed income strategies going forward?

Ans: The 50 bps repo rate cut was larger than expected but the change in stance to neutral and the CRR cut was a surprise for the markets. The central bank has been proactively managing liquidity and had already announced measures so there were no expectations on this front from the policy. I had been of the view that this current cycle would be shallow and that’s exactly how the cycle played out. The central bank is definitely prioritising growth while inflation is well under control. As indicated in most of our communication pieces, a significant part of the bond market rally is behind us and there would be limited rate cuts and that too if we see weaker growth. Rates will stay lower for longer. I expect macro indicators like GDP, CPI to remain soft for FY26. Consequently, there is nothing that can lead to significant upside in yields. I expect 1-5-year corporate bonds to rally and outperform long bonds on a risk reward perspective.

Q3. The RBI has recently discontinued daily Variable Rate Repo (VRR) auctions in light of a ₹3 lakh crore liquidity surplus. How do you interpret this move, and what does it signal about the RBI’s evolving liquidity stance and its potential impact on short-term rates?

Ans: The central bank had introduced daily VRR auctions on January 16, 2025, to address temporary liquidity tightness caused by tax-related outflows and foreign exchange interventions. However, with liquidity conditions now easing, the RBI is shifting its focus to stabilising overnight money market rates, which have been trending lower due to excess funds in the system.

We believe that these daily VRR are not the need of the hour and there is enough liquidity in the system.

Q4. India’s 10-year benchmark yield is currently around 6.31% as of July 15th. How are you positioning your portfolio across the curve in this environment? Are there specific segments-short, medium, or long-that offer better value at current levels?

Ans: After the larger-than-expected repo rate cut, shift to neutral stance from accommodative and unexpected CRR cut, markets remain in neutral. Liquidity remains abundant and we do not anticipate further cuts in the next 3-6 months. Analyzing macro data, lower GDP, softer CPI, lower for longer rates and abundant liquidity, we expect 1-5-year corporate bonds to rally and outperform long bonds on a risk reward perspective and foresee a limited rally in government bonds going forward. In fact we have shifted our allocation from higher government bonds to higher corporate bonds.

Q5. The RBI has revised its inflation projection from 4% to 3.7%. In your view, does it create room for more policy easing in the coming quarters?

Ans: As against the central banks inflation projection, headline inflation is already at 2.1% and I do not expect it to remain lower at this level for long. I believe that the RBI has frontloaded the interest rate cuts for this cycle; rates will remain low, and liquidity will remain abundant. While inflation projection for Q1CY26 is above 4%, we believe that unless we see big growth shocks there will be limited room for easing.

Q6. In your opinion, what could be the key triggers that might lead the RBI to consider another rate cut in the near term?

Ans: As mentioned earlier, I do not foresee further rate cuts in this year. However if the RBI was to cut rates it would be on account of a large slowdown in growth.

Note: Views provided above are based on information in the public domain and subject to change. Investors are requested to consult their mutual fund distributor for any investment decisions.

Please note we have published the answers as it is received from the Fund Manager of Axis.