Between September 2002 and June 2003, the fund's net assets have shrunk by 26 per cent, to Rs.209 crore, even as its NAV per unit appreciated by 23 per cent between these two dates.

The outflows began just after October 2002, with the speculation about Alliance Capital's pullout from India.

But the fund has continued to face net redemptions through the October-December 2002, December-March 2003 and March-June 2003 quarters.

Throughout this period, the fund has either remained fully invested or has shown a small net payables position (indicative of borrowings) at the end of each quarter.

The aggressive posture on equities has probably helped the fund make the best of the sharp appreciation in equity values over the past four months.

The fund has consistently preferred to pick stocks with a strong growth momentum, rather than those that appear to be undervalued or command limited market attention.

This has tended to restrict the portfolio's weights in mid-cap/small-cap stocks, which have been the centre of action over the past year.

The fund's IT exposure by end December was at about 23 per cent.

Exposure to banking stocks, which was at less than 10 per cent until December 2002, has been recently enhanced to around 16 per cent by June 2003.

But again, among the cyclical sectors the fund tilts towards sectors such as automobiles, two-wheelers and steel, with allocations to capital goods, commodity chemicals and non-ferrous metals at relatively low levels.

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