Financial Daily from THE HINDU group of publications
Sunday, Nov 24, 2002
Financial Daily from THE HINDU group of publications Sunday, Nov 24, 2002 |
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Investment World
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Mutual Funds Markets - Mutual Funds Prudential ICICI Power: Hold
INVESTORS in Prudential ICICI Power can stay with the fund. Its performance last year has been impressive relative to that of its peers. That has also given a sizeable lift to its longer-term performance record, which has been inferior to that of a few of the established peers. Investors can, therefore, increase exposures after further evaluation later. In October 2002, the fund held on to the relatively sizeable cash position of just over 10 per cent. The fund, however, continues to remain small-sized, with assets under management of just less than Rs 20 crore. Stocks sold and added: The fund exited Tisco and Hughes Software completely. It added Bharat Forge to the portfolio. Exposures enhanced: The fund added to its exposures in Jindal Iron, ABB Alstom, Tata Engineering, Zee Telefilms, Crompton Greaves and HPCL. More than 20,000 shares were added in the case of these stocks. Exposures were also added in Reliance Industries by around 13,000 shares. Exposures pared: The fund pared exposures in stocks such as Ashok Leyland, HCL Technologies, ACC, Larsen and Toubro and Infotech Enterprises. The fund's mandate is to invest in stocks of companies belonging to the core sector and the associated feeder industries. This suggests that this fund may hold concentrated exposures to sectors such as cement, steel and so on. However, for a considerable period now, the its strategy has not been largely different from that of any other diversified fund now. At the end of October 2002, automobiles and IT consulting accounted for 42 per cent of net assets. This was largely unchanged from what was prevailing at the end of September 2002. While the position in the case of IT consulting is comparable to the weight of IT stocks in Indices such as Nifty and Sensex, the fund is considerably overweight on auto stocks. But the concentrated exposures enhance the risks involved considerably. Investors need to consider this aspect before staying invested.
Suresh Krishnamurthy
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