The Hindu Business Line : Franklin India Prima Plus: Invest

Franklin India Prima Plus is one among the few funds with a track record of over 12 years. Its performance over three- and five-year periods reinforces our positive view on the fund.

The scheme primarily invests in large-caps with about 15-20 per cent in stocks with a market capitalisation of less than Rs 5,000 crore. Returns of 42 per cent and 44 per cent over a three-year and five-year period respectively place it ahead of Franklin India Bluechip.

Franklin India Prima Plus marginally outpaced Reliance Vision over a three-year period but trailed by 14 percentage points over a five-year time-frame.

Since the asset size of Prima Plus is smaller than the above-mentioned peers, it gives the fund the flexibility to deftly capitalise on any mid-cap rally.

Suitability: The fund is suitable for investors who prefer limited exposure to mid-cap stocks to prop up returns. Investors with a lower risk appetite can still use this fund as a diversification option, as the fund is conservative in its stock and sector choices.

Performance: The fund has generated a return of 46 per cent for one year and outpaced its benchmark index S&P CNX 500 by 12 percentage points. It trailed its benchmark in just eight of the past 24 months on a rolling return basis.

The fund adopted a hold strategy on banking stocks even at a time when the sector was under performing — a view that paid off when the sector rallied.

A systematic invest plan in the fund over the last year would have returned 51.5 per cent. This is higher than what a lump-sum investment would have yielded. Clearly, the cost averaging during volatile phases has delivered well.

Portfolio Overview: Franklin India Prima Plus had 44 stocks as of January 2007. The top ten stocks accounted for 45 per cent of the assets.

Consumer non-durables and pharma stocks, which were under-performers over the past year, together cornered 14 per cent of the assets.

The fund appeared cautious on metal stocks as it had very little exposure in the space over the last 12 months.

Fund facts: Franklin India Prima Plus was launched in September 1994. The fund is jointly managed by Mr Sukumar Rajah and Mr Satish Ramanathan. The minimum one-time investment is Rs 5,000 and in multiplies of Rs 1,000.The fund charges an entry load of 2.25 per cent.

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