The Hindu Business Line : SBI BlueChip Fund: Optimistic on pharma

SBI BlueChip Fund, launched in December 2005, collected over Rs 2,850 crore during its NFO. The fund's investment objective is to invest in a diversified basket of equity stocks of companies whose market capitalisation is at least equal to or more than the least market capitalised stock of BSE-100.

Over the quarter ended March 2007 the fund's asset size dropped by 17 per cent to Rs 1892 core. The fund made some changes to its portfolio in the above period. The energy sector continued to occupy the top slot, with a marginal increase in asset allocation. The fund accumulated shares of ONGC, Reliance Petroleum and Indian Oil Corporation, while it trimmed exposure to Hindustan Petroleum. Suzlon Energy was added afresh.

In the capital goods space, the fund stepped up exposure to Thermax and Crompton Greaves and instead pruned holdings in BHEL and Larsen & Toubro. The pharma sector had a lacklustre performance over the past year with the BSE's pharma index returning in the negative.

The fund, however, was optimistic about the sector as it accumulated stocks such as Dr Reddy's, Ranbaxy, Pfizer and Aventis Pharma.

The cement sector, which did not receive adequate representation in the portfolio during the past year, found the fund's favour over the quarter, as stocks in this space corrected on uncertainties post-Budget. With a marginal increase in the asset allocation to this sector, the fund stepped up holdings in Century Textiles while Grasim Industries was added afresh.

It appears that the fund preferred to play it safe on the IT sector, ahead of results, as it partially sold frontline stocks such as Infosys, Satyam Computer Services, TCS and Patni Computer. Wipro moved out of the portfolio.

Metals lost sheen as the fund pruned its holding in Tata Steel, and Hindalco Industries while National Aluminum and Hindustan Zinc completely exited the portfolio. Several of the construction stocks underwent selling pressure after the Budget. The fund also reduced asset allocation to the sector. Parsvnath Developers and Sobha Developers exited while Jaiprakash Associates and Hindustan Construction were sold partially.

The fund marginally reduced allocation to financial services with the pruning of holdings in Union Bank of India, Oriental Bank of India, State Bank of India and ICICI Bank. HDFC moved out of the portfolio, while IDFC was bought.

Suresh Parthasarathy

More Stories on : Mutual Funds | Recommendation | Portfolio Moves

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page