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S. Vaidya Nathan

INVESTORS can retain their exposures in Prudential ICICI Growth Fund. Over the past 18 months, the fund has consolidated on its performance as well as revealed a more consistent investment strategy. It has outperformed the broad markets comfortably.

Its long-term track record still has some way to go before it can match up to the likes of Bluechip, HDFC Equity and Prima, which have been consistent performers over a number of years and also most quarters during this period.

During the recent bullish phase, the company has notched up returns of about 78 per cent over the past year and about 33 per cent over the past three months. It has trailed quite a few diversified funds. But investors can stay invested as the portfolio may hold scope for gains. The fund has turned in returns of about 22 per cent per annum over the past five years.

Suitability: The risks associated with the fund are in line with what one can expect for well-diversified equity funds. The fund had an aggressive style in its earlier years. But now it has a strategy that is less aggressive and less momentum driven.

There is also a tilt towards large cap stocks. Due to the ongoing bullish phase, the fund's returns appear commensurate with the risks involved for long-term investors. First-time investors can, however, consider schemes such as Bluechip, Prima, HDFC Equity and HDFC Tax Saver.

Investors can stay with the dividend option due to its superior tax efficiency this fiscal, as dividends are exempt from tax.

Portfolio overview: The portfolio has a heavy tilt towards stocks from the auto, banking and metals sectors. Given the trends in the economy, this focus could pay off. Auto sector stocks account for 20 per cent of the net assets.

The fund has largely focussed on index stocks. Its exposures to mid-cap stocks are confined to the likes of Saw Pipes, Jindal Iron and Automotive Axles.

: Prudential ICICI Growth was launched in July 1998. The minimum investment amount is Rs 5,000. There is an entry load of 2.25 per cent. There is no exit load. The manager is Mr Dileep Madgavkar.<137>

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