Mutual Funds: Good Picks
Research Desk
HDFC EQUITY
Objective and
strategy
The scheme seeks to
provide long-term capital appreciation by predominantly investing in high
growth companies. HDFC Equity Fund focuses on investing in quality companies
that are reasonably valued and have a growth bias. The fund is providing
attractive returns by adhering to the set objective.
Fund Manager
The fund has been
successfully managed by Mr. Prashant Jain since 2003
and by Mr. Miten Lathia
since August 2010.
Performance
The fund
delivered a return of 29.22% for 2010 and 105.57% for 2009, much ahead of the
category average return of 18.89% and 86.68% respectively. It has outperformed
the Sensex and the Nifty in both the years and could
limit losses at 49.68% in 2008 while the market plunged by 51.79%. Thus, the
fund has displayed its resilience during the crash. Annualised
average return for the last five years is also attractive at 16.11% while the
category yielded an average return of 9.69%.
Portfolio
HDFC Equity manages net assets of Rs. 8400 crore. Of this, 66% has been deployed in large caps and nearly 31% in mid and small caps. Around 56% of the assets are deployed in financial, energy and technology stocks.
Value Research rating
Risk Grade - Below Average, Return Grade –
High
UTI DIVIDEND YIELD
Objective and
strategy
The fund aims to
provide medium to long term capital gains and/or dividend by investing
predominantly in equity and equity related instruments which offer high
dividend yield. As the name suggests, the strategy of the fund w.r.t portfolio creation is to invest 65% of the assets in
equity shares that have high dividend yield at the time of investment.
Fund Manager
The fund has been
efficiently managed by Mrs. Swati Kulkarni
since December 2005.
Performance
The fund has a track record of consistent growth over the
years. It has rewarded 13% for the last one year, which is significantly higher
than the category return of 6.50%. Annualised return
of 15% for the last three years and 16.40% for the last five year period are
also impressive while considering the category average of 4.85% and 8.60%
respectively for the said periods. Since its launch in 2005, the average annual
return has been a significant 22%.
Portfolio
The fund has a mix of large cap, mid cap and small cap in the portfolio. Exposure in the large cap is 71% of net assets (Rs.2998 cr.) while exposure in the three top sectors is 50%.
Value Research rating
The fund is given low
risk grade and high return grade by Value Research Rating.
BIRLA SL DIVIDEND YIELD PLUS
Objective and
Strategy
The scheme aims to
generate returns by investing in high dividend paying companies. The portfolio
is built with stocks that provide high dividend yield and capital protection.
It has also the flexibility to invest up to 35% in companies facing special
situations like de-merger, buy back etc.
Fund Manager
The fund had been
managed by Mr. Ankit Sancheti
from November 2007 to January 2011. Since then, it is being managed by Mr. Nishit Dholakia.
Performance
The fund has been doing reasonably well as compared to its
peers in the mid cap and small cap space. For the last one year, Birla Sun Life Dividend yield grew at the rate of 12% when
the category on an average yielded a 2.39% return; and the Sensex
and Nifty appreciated at the rate of 8% each. It is also an out performer with
substantial margin for other periods like two years, three years, five years
etc. Average annual return for the last five years has been above 14% while the
category yielded a 6.6% return and the market returns are hovering around the
9% range.
Portfolio
Birla Sun Life Dividend Yield is a mid cap oriented fund with 71% of its assets under management in the mid cap and small cap space. Exposure in the large cap is only 29%. The portfolio structure offers growth potential on the one side and a little higher risk on the other, as mid caps and small caps could be affected much at turbulent times.
Value Research rating
Risk Grade – Low, Return Grade – Above
Average.
RELIANCE EQUITY OPPORTUNITIES
Objective and
Strategy
The scheme has the
mandate to invest in stocks across sectors where the potential is substantial
due to ongoing economic reforms, FDI inflows and infrastructure changes. The
fund manager also has the mandate to go for debt to the extent of 25% of the
total portfolio.
Fund Manager
The fund was launched
in March 2005 and Mr. Sailesh Raj
Bhan has been managing the fund since then.
Performance
The fund has been an
out performer in the multi-cap fund segment with above average returns for
different time frames. For the last one year, the fund yielded around 12% when
the average return of the category was nearly 12%. Similarly, 54% annualized
return for the last two years; above 14% average return for the last three
years etc are indicators of its out performance. Annualised
average return of 23% since its launch is also impressive.
Portfolio
Reliance Equity Opportunities manages net assets of over Rs.2800 crore, which has been deployed in the large cap, mid cap and small cap spaces. Fund has been spread in 12 different sectors with a minor tilt towards services, technology and automobile.
Value
Research rating
The
fund is given AVERAGE Risk Grade & HIGH Return Grade by Value
Research rating mechanism.