The Hindu Business Line : Reliance Vision Fund: Banking consolidation

Reliance Vision Fund, a diversified equity fund, predominantly invests in large-cap stocks with a relatively smaller exposure to mid-cap and small-cap stocks. The fund has consistently outperformed its benchmark – BSE 100 – over one-, three- and five-year periods.

The fund has witnessed significant inflows over the past six months. This period has seen the fund’s corpus has increased by 44 per cent to Rs 4,281 crore, while the NAV has moved 32 per cent to Rs 264.45 as of November 30. Sector Moves: The sector exposures seem to reflect a combination of momentum and contrarian exposures. Capital goods (10.3 per cent) and banks (8.9 per cent), two sectors that have participated in all the major rallies over the past six months have seen further consolidation. But automobiles is now the top sector holding in the fund with a 12.4 per cent exposure. Pharma (8.44 per cent) is another top sector for the fund.

Power, a sector in favour, has seen exposures increase nearly three times to 4.2 per cent, while the exposure to finance stocks has been increased by four times to 6.52 per cent.

Software, which was the top sector six months ago, has seen exposures pared significantly. Stock Moves: Bajaj Auto (3.8 per cent), which wasn’t present in the fund’s portfolio, is now among the top-ten holdings, perhaps on anticipation of value unlocking after possible de-merger. ICICI Bank, another new addition, is a top holding. IDFC, a stock that has gained 77 per cent over the past six months and Indiabulls Financial Services, are also new adds.

Tata Steel, Gammon India, and Ranbaxy Labs are important additions to the fund. Interestingly, the fund has picked Patni Computer, a stock that has fallen 41 per cent in the last six months, again perhaps in anticipation of unlocking value due to a possible stake sale by some promoters to private players.

Jaiprakash Associates a stock that has gained over two-fold during this period, JSW steel, another company that had a sharp run-up find their way out of the portfolio. Holdings in Ambuja Cements, Tata Tea and Punjab Tractors also have been completely exited.

Heavyweights like L&T, Alstom Projects, Tata Motors Infosys, RIL, Maruti Suzuki, RCom, and Reliance Energy continue to be in the portfolio and the top holdings as well. Siemens (6.70 per cent) is the largest holding. Divi’s Labs (6.64 per cent) is the second largest.

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