The Hindu Business Line : Franklin India Bluechip: Invest

It has an impressive track record over a long period, though there was evidence of a slackening of performance in early 2005. The fund appears to have left that phase behind and, over the past couple of quarters, its performance has improved.

The fund has a focus on large-cap stocks; if equities go through a tough phase, these stocks may be better placed. This is why an exposure to Bluechip will be appropriate now.

This fund has remained on our short-list of preferred funds for well over five years now. It has shown an ability to weather different phases of the market, and has a track record matched by only a couple of other funds.

Over the past year, the NAV has risen about 55 per cent. The fund has beaten its benchmark by only a few percentage points; this is attributable to the indifferent performance in the first two quarters last year. Over three-, five- and ten-year periods, the magnitude of out-performance has been significant.

The fund's asset base has risen manifold over the past three years and is now in excess of Rs 2,000 crore.

Given the expansion in the universe of large-cap stocks, this asset size is not daunting. Investors should, however, take exposures with a three-year perspective; over such a period, it may be well-placed to deliver attractive returns for a large-cap focussed fund.

Suitability: The risks are in line with what one would expect for a diversified fund. The returns have been attractive and have more than adequately compensated for the risk element. Investors seeking to build a portfolio of funds should consider it as one of the core holdings.

Investors who have exposures to this fund could step up allocation. Exposures may, however, be phased out over a six-to-twelve month period using a systematic investment plan. This will also enable investors to take advantage of any weakness in the broad market.

Portfolio overview: In an interesting tilt, the preferred sector is automobiles. The fund has exposures in most vehicle manufacturers in the two- and four-wheeler space, though it seems to have missed out on Bajaj Auto, which has been on a relentless upward trend over the past few months. The fund has 10 per cent assets in engineering, banking and IT sectors.

Fund facts: Bluechip was launched in October 1993 under the Kothari Pioneer banner. Now it is owned Franklin Templeton. The minimum investment amount is Rs 5,000. There is no exit load. The fund manager is Mr K.N. Siva Subramanian.

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