Financial Daily from THE HINDU group of publications
Sunday, Feb 09, 2003
Financial Daily from THE HINDU group of publications Sunday, Feb 09, 2003 |
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Investment World
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Mutual Funds Markets - Mutual Funds Alliance Equity: Hold
WITH Alliance Capital Inc., the US stakeholder in Alliance Capital Asset Management, reaffirming that it will continue with its Indian operations, investors in the Alliance Equity Fund can retain their investments for now. However, the sequence of events that unfolded after the first reports of a possible exit by Alliance (reports of redemption pressure, followed by a fall in prices of select stocks in the fund's portfolio) highlight the vulnerability of this fund to a change in fund management personnel. Investors in this fund should, therefore, keep a closer watch on the changes in fund management. The portfolio of Alliance Equity Fund for the end of January 2003 is not yet available. But an evaluation of the changes in portfolio between September and December 2002 suggest that the fund suffered some outflows. The fund booked profits on a range of pharma, IT and auto stocks during the quarter. The sectoral composition of the fund also changed significantly: Stocks sold: Though the fund pared exposures on a range of stocks, only a few were completely removed from the portfolio. During the quarter, the fund completely exited its holdings in Satyam Computer, Grasim, Century Textiles, Britannia, Sesa Goa, Visualsoft and Glaxo India. Exposures pared: While few stocks were completely liquidated, the fund pared exposure on 28 of the 47 stocks in its portfolio. The fund appears to have pared exposure in a range of IT stocks-Digital Globalsoft, Infosys Technologies, Hinduja TMT, E Serve, Mastek and Polaris during the quarter. Stocks added: The profit-booking notwithstanding, the fund has added a few stocks to its portfolio during the quarter. Andhra Bank, Bank of India and SBI were the notable additions, along with Reliance Industries. Exposures enhanced: The fund also added to its existing holdings in PNB, United Phosphorus, Vesuvius, E Serve and Sun Pharmaceuticals.
Aarati Krishnan
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