The fund manager has accumulated State Bank of India and ICICI Bank in last one year
and both have outperformed the BSE 200 index. He also reduced exposure in Reliance Industries , which has underperformed the benchmark. The scheme adheres to a strict buy and hold philosophy with little churn in holdings and sector bets.
Franklin India Bluechip: It has been among the more stable schemes, delivering above-average returns consistently.The steady performance of the scheme, along with a corpus of above Rs 2,700 crore, has helped it maintain investor confidence. The scheme focuses on well-established, large size companies.
The highest allocation has been towards the banking sector, followed by the oil & gas sector. Though the exposure to the telecom sector has reduced from 9% to approximately 5% in the past six months, the overall exposure in this segment has remained substantially
high.
This has contributed to lower returns as the sector has remained an underperformer. The exposure to the FMCG sector has also reduced over the last six months.
Tata Pure Equity Fund: The scheme focuses on undervalued large-cap companies. It has delivered above-average returns over various time frames. The scheme is diversified across 30 to 50 stocks and across 17 to 28 sectors, mostly in the past three years. This provides the scheme with a lower volatility.
The scheme has, however, maintained a very low exposure to the banking sector and the exposure to oil & gas sector has also been reducing consistently. A sudden hike has been seen in the IT and automobile sectors over the past six months. The scheme has reduced its exposure in the capital goods sector, which has been an outperformer in the past three years, while it has increased exposure in the underperforming FMCG sector over the past two years.
In a nutshell
The large-cap category in the previous bull phase delivered average annualised returns of 44.26%, beating the market barometer — BSE Sensex — which returned 35.59% annualised returns over the period of six years (CY 2002-2007).
Hence, the current recovery phase could hold similar investment opportunities for investors, particularly the ones who are nervy and shun excessive volatility in returns.
Though the large-cap category is known to offer better protection to investors in the downturn, there are exceptions to this rule.
More aggressive, racy investors might find themselves dissatisfied with the returns delivered by these funds as these schemes may not appear in the top slot of the diversified equity category further into the recovery.
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