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IT may be better for risk-averse investors to hold off fresh investments in the equity markets at this juncture. But for those who are willing to assume a degree of risk, the Templeton India Growth Fund (TIGF) is among the better options available within the universe of equity funds.

With the fund's investments in cyclical and commodity stocks paying off in a big way, the TIGF is among the top performing equity funds over 2003. In 2003, the fund was ahead of the pack even among funds such as Franklin India Bluechip, HDFC Equity and HDFC Top 200 Fund, which have a good five-year track record.

The fund's performance stands out on two counts. One, the fund has invested predominantly on large-cap stocks even over the past year. This is likely to lower the volatility associated with its returns.

Second, the fund's portfolio features a much lower degree of churning when compared to most other diversified equity funds. This appears healthy as it should lower transaction costs and result in higher effective returns for investors.

In the month of November 2003, the fund has not made any new additions to its portfolio. Instead, it has booked profits on a range of its existing holdings. The fund made the following changes to its portfolio in November 2003:

Exposures pared: The fund pared exposures to Tata Power, GAIL, BHEL, Concor, Cummins, HCL Technologies, Satyam, NIIT, Bajaj Auto, GSK Consumer, and Cipla during the month. The fund appears to have sought profit-booking opportunities across the range of sectors.

Sectoral positions: Banking stocks remained the fund's top exposures, at 15.7 per cent. IT stocks accounted for around 12 per cent of assets, with auto ancillaries, and oil and gas companies following, as the big sectoral positions. The fund remained almost fully invested, with just 1.5 per cent of its assets held in cash.

Aarati Krishnan

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