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Fund aims to generate long-term capital appreciation

The secondary objective is to generate consistent returns by investing in debt, money market securities, REITs and InvITs

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Launched in August 2007 as Reliance Top 200 Fund, the scheme was renamed and repositioned as Reliance Large Cap Fund after the reclassification of mutual fund schemes by Securities Exchange Board of India. The fund ranked 2 in the large-cap category of CRISIL Mutual Fund Rankings (CMFR) - June 2018. Saliesh Raj Bhan, who has been associated with Reliance AMC since 2003, has been managing the scheme since 2007.

The fund's month-end assets under management (AUM) increased over five times from Rs 2,005 crore in September 2015 to Rs 11,601 crore in August 2018. Its investment objective is to generate long-term capital appreciation by investing predominantly into equity and equity related instruments of large-cap companies. The secondary objective is to generate consistent returns by investing in debt, money market securities, REITs and InvITs.

Trailing returns

The fund has outperformed the benchmark (S&P BSE 100 TRI) during the past five, seven and 10 year trailing periods and consistently outperformed the peers (funds ranked under the large cap category in CMFR - June 2018) across all trailing periods under analysis.

Point-to-point returns

An investment of Rs 10,000 in the fund on August 08, 2007 (inception date of the fund) would have grown to Rs 32,674 (11.20% CAGR) as on October 1, 2018 vis-à-vis the benchmark's Rs 28,561 (9.86% CAGR) and the category's Rs 29,226 (10.09% CAGR).

SIP returns

A monthly investment of Rs 10,000 via a systematic investment plan (SIP) for 10 years would have grown to Rs 25.72 lakh (XIRR 14.79%). A similar investment in the benchmark would have grown to Rs 23.48 lakh (XIRR 13.07%).

Risk-reward matrix

The fund delivered higher average daily returns over the past three years relative to peers, coupled with relatively higher volatility.

Portfolio analysis

During the past three years, the fund invested in 96 stocks, chiefly in the largecap space. Over this period, largecap exposure averaged 79.72 % of the portfolio. The top five sectors constitute 56.51% of the fund's equity portfolio as of August 2018. Banks have the highest allocation of 25.35% followed by pharmaceuticals (9.07%), finance (8.08%), petroleum products (7.33%) and construction project (6.69%).

In the past three years, the banking sector had the highest average allocation of 22.84%. HDFC Bank, ICICI Bank, Axis Bank and State Bank of India were the consistently held stocks in the sector during this period. HDFC Bank was the key contributor to the fund's performance from the banking sector.

Out of the 96 stocks the fund invested in during the three years, it consistently held 15. Among the consistently held stocks, HDFC Bank, Reliance Industries, TVS Motor Company, Petronet LNG and Larsen & Toubro were the highest contributors to the fund's performance. Other key contributors include Bajaj Finance, ITC and Indian Oil Corporation.

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