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Shanthi Venkataraman

INVESTORS can stay with Birla Advantage Fund. The fund outperformed the benchmark indices by a significant margin over the year.

It should, however, not be the only fund in your portfolio as its performance over a one-year and three-year period compares poorly with that of several of its peers.

The fund's track record has faltered since 1999.

Although it turned in a strong performance in 2003, its returns still lagged a number of top performing funds.

In 2004 as well, its performance would figure somewhere in the middle of the performance rankings, with its returns of about 25 per cent.

As such, fresh exposures to the fund may be avoided.

Suitability: The fund carries risks similar to that of other diversified equity funds.

Investors who have substantial holdings in this fund may consider diverting their investments to funds that have a superior track record such as Franklin Bluechip, HDFC Top 200, Templeton India Growth or HDFC TaxSaver, if these funds are not already a part of their portfolios.

First-time investors may also consider the above-mentioned funds ahead of Birla Advantage.

Portfolio overview: The banking and pharmaceutical sectors, which form the top holdings of the fund, account for about 35 per cent of its total assets.

The fund has had a tendency to take concentrated exposures to sectors in the past. The portfolio has, however, taken on a more diversified look over the past year.

The fund has liberal exposures to mid-cap stocks. It holds about 40 per cent of its assets in stocks that have a market capitalisation of less than Rs 3,000 crore.

The fund appears to have favoured mid-cap pharma stocks such as Aventis Pharma, Novartis and Pfizer. LIC Housing Finance, Kochi Refineries, Thermax and CMC are some of the other prominent mid-cap stocks that figure in the portfolio.

The asset base has seen a decline of two per cent on a year-on-year basis, which, given the spurt in net asset value of 25 per cent in 2004, points to significant outflows during the year.

Fund Facts: Birla Advantage was launched in 1995. The fund has an asset base of about Rs 500 crore. Both dividend and growth options are on offer.

The minimum investment amount is Rs 5,000. The fund manager is Mr Nishid Shah.

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