• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Shanthi Venkataraman

INVESTORS can hold on to PruICICI Power. The fund has a good three-year track record. In 2003, it was among the top performing funds. But in 2004, its performance has been more sedate, lagging that of other diversified equity funds. Given its relative underperformance, investors can hold on to the fund for the present and consider further exposures once its performance improves.

Suitability: The fund has a higher risk profile compared to other diversified equity funds. It takes concentrated bets on select sectors. Its returns may, therefore, be more volatile when compared to other diversified equity funds.

Performance: The fund has delivered an annual return of 50 per cent over a three-year period. In 2003, the fund generated as well, it generated an impressive return of 125 per cent. In 2004, however, its returns have been more modest at about 20 per cent.

In the first half of the year, its net asset value declined more than 15 per cent. Although its performance recovered in the second half, its 45 per cent return was not impressive compared to its peers, which generated 60-70 per cent during this period.

Portfolio overview: The top three sectors account for more than 40 per cent of the assets. Exposures to any single stock, however, do not exceed 7 per cent.

The fund takes bets on two sectors at a time. For instance, IT and banking sectors were the top two sectors till May. In June, the fund switched focus from banking to engineering stocks.

Within the IT and engineering sectors, the fund has spread its holdings over a basket of stocks. Besides Satyam and Infosys, TCS, Hexaware, Hughes Software and HCL Tech are the other stocks that form part of its IT portfolio.

Eight of the top ten stocks in its portfolio have a market capitalisation of more than Rs 5,000 crore.

A few of the mid-cap stocks that figure in the portfolio include Thermax, Indo Gulf fertilisers, IPCA labs, United Phosphorous, Bharat Forge and Britannia.

: PruICICI Power was launched in 1994. It became an open-ended fund in 2004. The fund has an asset base of Rs 477. It offers dividend and growth options. The minimum application amount is Rs 5,000.<137>

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Portfolio management service — This can pay off for the well-off

Copyright © 2005, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line