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Vidya Bala

PRUICICI Emerging S.T.A.R (Stock Targeted At Returns) is an open-ended equity fund that aims at capital appreciation by investing in diversified mid-cap stocks. We take a look at how the fund managed its portfolio over September-December 2005.

PRuICICI Emerging S.T.A.R had about 55 stocks in its portfolio as of December 2005. The average price-to-earnings ratio of the portfolio was 23. Over the three-month period, industrial capital goods slipped to second spot in the sector-wise allocation.

Exposure to software was enhanced from 11.9 per cent to 13 per cent. Saksoft, Visual Soft, Hexaware Technologies and Tulip IT Services were some of the new additions in the space. i-flex Solutions and Aptech, however, lost favour and exited theportfolio.

In the capital goods segment, newly-listed Punj Lloyd was the only addition. The rest of the stocks underwent some re-jig in terms of weights. Exposure to Bharti Shipyard was pruned by over 60 per cent while Stone India was added. The construction space continued to be represented by a single stock, with Patel Engineering replacing IVRCL Infrastructure & Projects.

Exposure to cement stocks was pruned. The fund completely exited Madras Cements and pared exposure to Hyderabad Industries. The recent uptrend in sugar stocks may have prompted the fund to raise asset allocation to sector. While Bajaj Hindusthan was added, Mawana Sugars, Simbhaoli Sugar Mills and Triveni Engineering were added to the commodity portfolio.

Allocation to bank stocks remained largely unaltered. Jammu & Kashmir Bank took the exit route and Karur Vysya Bank was bought afresh. India Infoline continued to be the sole representative of finance stocks.

Over the quarter, the net assets increased from Rs 310 crore to Rs 335 crore, an increase of about 8 per cent. Net asset value per unit grew from Rs 18.4 to Rs 20.3, an absolute growth of 10.3 per cent.

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