The Hindu Business Line : ICICI Prudential Services Industries: Software pruned

ICICI Prudential Services Industries Fund appears to be theme fund, but in practice has quite a diversified exposure to sectors and stocks. Funds such as Tata Service Industries Fund and UTI Service Industries Fund appear more focussed and their top three sectors account for over half of their assets. In contrast, ICICI Prudential has well-diversified portfolio. The top three sectors accounted for 35 per cent of the assets and the top ten stocks corner 29 per cent of the portfolio. In June-August 2007, the fund witnessed huge inflows and assets grew 40 per cent to Rs 755 crore. The NAV moved up marginally, and there were a few portfolio changes.

Among the sector exposures, those to banks, software, media and entertainment, auto ancillaries and industrial products were pruned. With fresh inflows, the cash position rose to 12 per cent. The fund stepped up exposure to sectors such as telecom services, construction, capital goods, pharmaceuticals, textile products and power.

In the telecom space, the fund accumulated Bharti Airtel, Reliance Communication and Avaya Global Connect, by adding to existing holdings. Idea Cellular moved into the portfolio during the quarter. The fund added 10 lahks shares and sold half the holdings in a month’s time.

Orbit Corporation was added afresh, while holdings in Patel Engineering increased fourfold. Nagarjuna Construction, Jaiprakash Associates and B.L.Kashyap were retained in the construction sector without much change in the holdings. Larsen and Toubro and Siemens India were the new additions. Exposure to Bharat Electronics was increased.In the pharma sector, exposure to Dr Reddy’s Labs, Indoco Remedies and Elder Pharma were added to. Lupin was added afresh. The fund pared exposures to Sun Pharmaceuticals.

Page Industries stepped into the portfolio, while holdings in Aditya Birla Nuvo and Gokaldas Exports were increased.Software sector weight in the portfolio was pruned. Infosys Technologies and Tech Mahindra were sold. Satyam Computer and Geodesic Information Systems were added. Exposure to Financial Technologies India increased significantly.

The fund marginally reduced holdings in banking sector and sold shares of Bank of Baroda and Union Bank of India. Exposure to frontline banks ICICI Bank and HDFC Bank was increased. State Bank of India was the new addition to the portfolio.

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