The Hindu Business Line : PruICICI Infrastructure Fund: Trims cement, power

PruICICI Infrastructure Fund is a theme-based fund launched in September 2005 with the objective of capital appreciation derived from the growth and development of the infrastructure sector. We take a look at the churn in its portfolio between April and July 2006, when its asset size declined 32 per cent to Rs 1,230 crore.

The fund enhanced asset allocation to banking, petroleum products, ferrous metals, hotels and auto ancillaries, and pruned exposures in cement, construction, capital goods and power.

It shed holdings in Oriental Bank of Commerce, bringing down its exposure to one-tenth from the past quarter, while HDFC Bank exited the portfolio. The fund stepped up exposure in State Bank of India, Andhra Bank, Punjab National Bank and Corporation Bank.

Petro-products found favour with the fund and asset allocation to this sector trebled. Indian Oil Corporation stepped in, and exposure to Reliance Industries increased.

Similar to other diversified funds, PruICICI Infrastructure, too, increased its holdings of ferrous metals. Jindal Steel & Power moved into the portfolio while SAIL exited.

Exposure to stocks such as Adhunik Metaliks and Usha Martin was enhanced. Monnet Ispat and Sesa Goa were trimmed.

The hotels space under went a minor re-jig with Hotel Leela Venture moving out of the portfolio. Exposure to Indian Hotels was increased, while the fund partially sold its holdings in EIH.

The asset allocation to the cement sector came down marginally, though Gujarat Ambuja Cement was added afresh. Century Textiles and JK Cements also came on, while exposure to stocks such as Grasim Industries and OCL India was pared.

Several construction stocks, which hit lifetime highs, witnessed churn. Nagarjuna Construction went out of the portfolio while Hindustan Construction stepped in to fill the void.

The fund found interest and increased its exposure to Patel Engineering and Jaiprakash Associates.

In capital goods, exposure to stocks such as Crompton Greaves, BEML, BHEL and Alfa Laval was reduced. The fund increased exposure to Siemens, despite its sharp run-up. Bharat Bijlee was the lone stock to step into the portfolio in this sector. In the power sector, exposure to National Thermal Power Corporation almost doubled, while Reliance Energy Ventures exited the portfolio.

Mr Sankaran Naren manages PruICICI Infrastructure Fund. Its NAV per unit is Rs 22.40.

Suresh Parthasarathy

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