The Hindu Business Line : Pru ICICI takes stake in small, mid-size cos

Prudential ICICI Mutual Fund appears to have stepped up activity in the past few days, as evident from its decision to pick up stakes in a clutch of companies, mostly small and mid-sized.

Several equity funds in the Pru ICICI stable have zeroed in on names such as Usha Martin, India Nippon Electricals, Aksh Optifibre, Kamdhenu Ispat and Lloyd Electric. Its involvement in these outfits is courtesy schemes such as Pru ICICI Discovery and Pru ICICI Emerging S.T.A.R.

Both schemes have a diversified portfolio, sources say.

Pru ICICI MF has positioned Discovery as a fund that would invest in stocks that carry attractive valuations in relation to earnings or book value or current/future dividends.

On the other hand, Emerging S.T.A.R (Stocks Targeted At Returns) is oriented towards mid-cap counters, chiefly corporates with a market capitalisation in the Rs 100-2,000 crore range.

The deals worked out by the funds are quite different from one another in terms of size and features.

Wire ropes manufacturer Usha Martin saw the fund house acquire 50,000 shares a few days ago, while Lloyd Electric witnessed transactions in 4.5 lakh shares.

Other allocations involved a 5.85-per cent stake in India Nippon and a 5.26-per cent stake in Kamdhenu Ispat.

The former entailed over 4.7 lakh shares, while the latter required a higher chunk — 10 lakh shares.

On another front, the fund house had earlier reduced its stake in Alps Industries by selling one lakh shares.

In the Usha Martin case, several funds have been involved lately. Pru ICICI's holding in the company, after the purchase of 50,000 shares, is through three different schemes: Emerging S.T.A.R, Power and Infrastructure.

The last-named scheme has over 3 per cent of the company's capital.

The fund has acquired an additional 1.67 per cent holding inLloyd Electric.

Emerging S.T.A.R. now has over 5.5 per cent of its paid-up base. Kamdhenu Ispat has seen the same fund acquire 10 lakh shares, raising its holding to nearly 5.3 per cent.