The Hindu Business Line : Reliance Equity Opportunities: Optimistic on info-tech

Reliance Equity Opportunities is an open-ended equity scheme with the objective of investing in stocks across sectors and market capitalisations. The fund seeks to invest in value and growth stocks, and is not aggressive in churning its portfolio. The fund has invested more than 50 per cent of assets in mid-cap stocks. Over the past six months, assets under management declined by 25 per cent to Rs 1,972 crore. During the same period, the fund’s NAV lost 13 per cent. The fund has a very compact portfolio of 37 stocks.

Over the six months ended April the fund diluted its holdings in capital goods, banks, auto, consumer durables and media and entertainment. Instead, it accumulated software, pharmaceuticals, construction, petroleum product, telecom and ferrous metals.

Capital goods’ weight in the portfolio declined from 17 per cent to 11 per cent during the six months. With stocks in the space rallying too far, Reliance Equity preferred to dilute its holdings ahead of January correction. Holdings in BEML, Siemens and Cummins were reduced while exposure to Areva T&D and Alstom Projects India were increased. Engineering major Larsen and Toubro was the new addition to the portfolio. Despite banking stocks correcting sharply in the last two months, the fund’s holding in the segment remained intact, albeit with minor rejigs. The fund sold shares of State Bank of India and ICICI Bank and, instead, accumulated Bank of Baroda.

The fund has been optimistic on the IT sector which, on an average, forms 13 per cent of the assets. The fund accumulated shares of Infosys Technologies and Mphasis to the existing lots, while it reduced holdings in HCL Technologies and Info Edge India.

Pharma, one of the worst performers in the past few years, has witnessed improvement in the volatile markets beginning January 2008. The fund utilised the correction in Aurobindo Pharma, Divis and Aventis Pharma and added these stocks. Exposure to Cadila Healthcare was, however, pruned while Biocon moved out.

Construction sector was viewed cautiously as the fund selectively picked stocks such as Jaiprakash Associates and Hindustan Construction. In the cement segment Ultratech was retained without much change in holdings. Tata Steel and Dish TV India were added.

SURESH PARTHASARATHY

More Stories on : Mutual Funds | Mutual Funds | Portfolio Moves

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