The Hindu Business Line : DSPML Small and Mid Cap Fund

DSPML Small and Mid Cap Fund was launched in November 2006. The fund predominantly invests in stocks that do not form part of top 100 stocks by market capitalisation. However, it is allowed to invest up to 35 per cent of the assets in the top hundred stocks. The fund prefers to have value as well as growth stocks in the portfolio. Between May and July 2007 the asset size declined to Rs 1,400 crore, though there was a 11 per cent surge in the NAV in the same period. The fund has a well-diversified portfolio comprising 70 stocks with the top ten accounting for 26 per cent of the assets.

While the construction sector has been viewed cautiously by several funds, DSPML preferred to step up exposure to the sector even as it increased holdings in banks, industrial products, auto ancillaries, ferrous metal and cement. In the construction space the fund added DLF along with Jaiprakash Associates, Hindustan Construction and IVR Prime Urban Developers. It pruned IVRCL Infrastructures and Nagarjuna Construction.

In the banking sector the fund trimmed holdings in Federal Bank, Centurion Bank of Punjab, Indian Bank and Andhra Bank. Frontline private sector bank ICICI Bank was the new addition. Industrial products underwent a minor rejig as exposure to Essel Propack increased. The fund, however, partially exited Kirloskar Brothers, Jain Irrigation and Electro Steel Casting. Ceat Tyres and JK Tyre & Industries were accumulated. The fund pared exposure to Amtek India and Federal-Mogul Goetze.

DSPML Small and Mid Cap Fund sold a part of its holding in Welspun Gujarat and Maharashtra Seamless and instead increased allocation to ferrous metals. Shree Precoated Steels and Godawari Power & Ispat were added afresh.

The weight of cement in the portfolio surged from 2.9 per cent to 5 per cent. Kesoram Cement and Madras Cements were sold partially, while Orient Power & Industries was added.

The fund reduced its allocation to the software sector by paring exposure to NIIT Technologies, Subex Azure and i-GATE Solutions. Holdings in Infosys Technologies were enhanced along with Opto Circuits and Mphasis BFL. Patni Computer was added.

Exposure in Jindal Saw Pipes, BEML and Larsen & Toubro was reduced.

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