Birla India Opportunities Fund was taken over from the erstwhile Apple Mutual Fund and re-launched in December 1999.
Kunal Bang
Birla India Opportunities Fund was taken over from the erstwhile Apple Mutual Fund and re-launched in December 1999. The fund was an IT sectoral scheme after it re-launched in 1999.
The name and investment objective of the scheme was changed in August, 2003. The scheme aims at investing in companies that are involved in outsourcing business by serving the needs of the global customers with India’s low cost and high quality resources.
The performance of the scheme has been very disappointing. The scheme has delivered negative growth of 2.37% in the last one year when its benchmark S&P CNX500 has grown by 32.66%.
In the long-term, the scheme’s performance has not been impressive and has underperformed its peer group and benchmark with a huge margin.
The scheme has grown by a compounded annualised rate of 24.99% way behind its peer group average of 40.17%. The scheme could not even surpass its benchmark with CAGR of 36.90% in the same period. In the 5-year period, the scheme ranks 54 out of the total of 59 schemes in its peer group, delivering a below average returns of 32.80% compounded annualised.
The scheme is managing a corpus of Rs 69.78 crore, which has decreased by 22% in the last one year. The scheme has registered a continuous decrease in the past four months after the disappointing performance.
The fund can allocate 70-100% of its assets in equities and equity-related securities and up to 30% in debt and money market instruments. Over the last one year period, the scheme has allocated on an average of 95% in equities and the rest in cash & equivalent.
The fund has exposure in 31 companies as per the latest portfolio with the top 10 holding have around 50% of its net assets.
The scheme has diversified itself in 18 sectors with the top 5 sectors has an exposure of around 50%. As per the investment theme, the scheme holds onto positions in the IT sector with as much as 13% exposure of its net assets, which was 46.29 in the month of January last year.
The scheme is overweight in sectors like textiles (11.18%) and electricals (8.4%). The rupee appreciation has affected IT and textiles sectors and consequently the performance of the scheme.
In the IT space, the company has major investment in Satyam Computer Services with 5.57% of its net assets. Compared to December, the fund manager has added Alok Industries, HCL Technologies and Everest Kanto Cylinder in January portfolio.
Comparing with its Opportunities fund peer group, the scheme is currently scoring low to be an aggressive investment option. The investors have more option in the opportunities category, and therefore investment in Birla India Opportunities Fund can be deferred until some turnaround in the scheme’s performance is noticed.
By arrangement with mutualfundsindia.com, a unit of Icra Online
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