Diversified equity funds close to 52-week peaks

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Top players well exposed to large cap stocks

Our Bureau

Kolkata, Sept. 7

A clutch of diversified equity funds are close to their 52-week peaks, reflecting the state of the stock markets, a look at the latest net asset value (NAV) tables indicate.

Equity funds, many of them gaining markedly in the backdrop of a strong surge in valuations, are being led by the likes of Franklin India Prima, Birla Sun Life Equity, Reliance Vision and HDFC Equity — names that are ruling close to their yearly highs.

The list, however, is topped by Reliance Growth, which had a NAV of Rs 319.45 on September 6, marking its own 52-week high.

Year-high peaks

Some of the other funds that are running close to their annual peaks are Franklin India Blue Chip (NAV: Rs 151.01), Franklin India Prima Plus (Rs 162.56), HDFC Index Sensex Plus (Rs 168.59) and Birla Advantage Fund (Rs 142.09).

The 52-week highs are Rs 153.15, Rs 163.93, Rs 170.22 and Rs 142.38. These figures, pertaining to only the growth options, have been sequenced by Value Research. A section of the funds in question, considering the top few players, are well exposed to large-cap stocks, the latter making up a critical portion of their portfolios, sources familiar with the trend suggest.

A number of large-caps have, after the recent bout of decline, gained ground, it is pointed out.

Reliance Growth has spread its assets over stocks across the market-cap range. Its top holdings in recent times have included Divi’s Labs, Jindal Saw, BEML and JSW Steel.

Other funds

In July, Divi’s was the top holding, accounting for over 4 per cent of the assets. Some of its super-large cap holdings were Reliance Industries, SBI and Maruti.

As for sectoral allocations, metals and metal products made up 12 per cent of the portfolio, followed by energy and healthcare with 8.6 per cent and 7.4 per cent, respectively. Franklin India Prima, which occupies the second slot in the list, is more mid-cap oriented. Some of its top holdings are Aditya Birla Nuvo (7.2 per cent of the assets), Jai Prakash Associates, India Infoline and India Cements. Engineering and construction have large allocations — roughly 18 per cent and 13 per cent respectively.

Birla Sun Life Equity, at the third position, is again invested seriously in large-caps. In fact, heavyweights like Bharti Airtel, Infosys and ICICI Bank are part of its top-10 holdings list.

United Breweries, with 4.9 per cent, is its foremost exposure. The technology sector makes up a high 19 per cent of its allocations, followed by engineering with 14 per cent.

(This article was published in the Business Line print edition dated September 8, 2007)
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