Date: Friday , January 31, 2003
WHO: GURUDUTT BALIGA, Senior Vice President, Alliance U.S., and Portfolio Manager. Guru Baliga has 17 years investment experience and has been at Alliance U.S. for the past 3 years. His areas of expertise include U.S. and Global Equity large capitalisation growth companies. The Alliance Capital Group manages approximately $451 billion in assets under management.
STRATEGY: “At Alliance, I handle large cap growth companies, here in the U.S. and overseas,” says Baliga. “My strategy is to look for long-term financial sustainability. Growth companies have a tough time when the economy contracts, like the last year.” Baliga invests in large growth companies that have shown sustained increase in value. “In a longer term, we look at companies that can grow from $100 million to $200 million to half a billion...not companies that grow from $100 million to a billion and then collapse.” These companies, typically, tend to be large, multinational corporations, where the sustainable value in competition remains on a steady growth curve.
PORTFOLIO: “I look at retail—an industry that is constantly reinventing itself. Concepts like Wal-Mart have extremely strong long term value. Kohl’s, a concept store, brings shopping down to customer convenience. These interest us,” says Baliga. “We also are looking at healthcare—everybody wants to live longer!” This space, says Baliga, is key, in that it helps people enjoy wealth. Despite the bottlenecks in growth—like lack of FDA standards, drugs coming off patents and so on, Baliga declares healthcare promising. “Consumer markets are always good. People need to shave, eat, launder—there is always growth here,” comments Baliga.
ADVICE: “Investors should look at the risk-returns framework in equities. If you look at only returns and bail out at the first risk, you will end up buying high and selling low,” cautions Baliga. Equities are fundamentally ownership in companies, he says, which tend to perform well over long periods. “Making a quick buck is not investing. It is gambling. If you want to do that, you’d be better off at a casino,” says Baliga. “Don’t fix the top, don’t fix the bottom, focus on the middle portion, where you need to be clear about what your time frame is, and what are the amounts you plan to invest.” Whether capital markets or emerging markets, over a period of time, these gain stability and grow. Baliga urges that this is the best time to be investing.