The Hindu Business Line : DSPML Opportunities : Well diversified

DSPML Opportunities Fund invests in a mix of large-cap and mid-cap stocks (about 13.5 per cent of the portfolio). It holds 76 stocks, across 30 sectors, making it quite fragmented. The fund has consistently beaten its benchmark Nifty over one-, three-, and five-year periods. The fund size has grown 11.5 per cent to Rs 1,620 crore, while the NAV has increased 36 per cent to Rs 80.7 (growth option) over the last six months. The churning of stocks has been fairly vigorous during this period.

Sector Moves: As with many diversified equity funds, capital goods (15.2 per cent) is the top sector holding for the fund, and it has maintained this level of exposure during the last six months. Banking (10.6 per cent) has also seen further consolidation, and is the second largest sector.

The construction and cement sectors have also seen substantial increase in the levels of participation in the portfolio, thanks to their riding on the Indian infrastructure story. Interestingly power sector exposures have gone up seven times, but remain at 3.5 per cent of the portfolio.

The finance sector has seen an increase of nearly four times during this period. With the IT sector under-performing over the past year due to macro cues, exposure to this sector has been reduced to less than half the levels o six months ago and stands at 5.7 per cent. Incidentally, this was the fund’s top sector six months ago.

The pharma sector has also seen substantial paring of exposures. Interestingly, holdings were reduced in telecom services.

Stock Moves: Jaiprakash Associates, a stock that has doubled in value in the past six months, is a recent addition and is the second highest holding (4 per cent) for the fund. Interestingly, this trend of buying stocks that have run up steeply (those that have appreciated 2-10 times in six months) seems pervasive in its new buys with inclusion of companies such as Jai Corp, Sesa Goa, Kotak Mahindra Bank, and Sintex Industries.

Mundra SEZ and Mercator Lines are new inclusions in the marine transport segment. Maruti Suzuki and Axis Bank are the other heavyweight additions.

Patni Computer and Hexaware Technologies, two stocks that have fallen over 35 per cent from their highs, have been pared. Cipla and Dr Reddy’s Labs, both underperformers, find themselves out of the fund. Reliance Capital, that has doubled in price in the last six months, has also exited.

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