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UTI MEP '92

Dhirendra Kumar

MEP '92 is a closed ended equity-linked tax-saving scheme due for redemption in March 2002. The scheme is open for repurchase at a 5 per cent discount to its NAV. Since its launch, MEP '92 has given an annualised return of 8.58 per cent against 2.23 per cent of the Sensex. The fund's portfolio was widely diversified across large cap cyclical stocks with more than 50 per cent in PSU stocks.

By June 1996, the fund initiated some consolidation of its portfolio but opted for a sectoral shift only as late as September 1999 with FMCG and software & telecom leading the pack. As on December 1999, the fund had 21 per cent and 18 per cent respectively in these sectors. It has also retained petroleum (7.5%), diversified companies (6.7%) and metals (6.4%). The fund has modest stakes in pharma, cement and financial Institutions.

It has gained 46 per cent and 4 per cent in the past year and quarter ending February 2000. The absence of reasonable exposure to IT at the right time has taken its toll — it has not been able to participate in the ICE rally of 1999 and despite the gains, it has been trailing behind all the benchmarks. Given its well-diversified portfolio, MEP '92 can be a steady performer and beneficiary of the recent change of heart favouring cyclicals.

The fund is the largest sized fund of its category. Launched in April 1992, the fund mobilised a huge corpus of Rs 1274 crore. A large fund launched in the roaring market of 1992, the fund could not perform. The huge asset base, passive management and failure to capitalise on the brief narrow upsurge in markets made MEP '92 an average performer. As a result, the fund has lost as much as 68 per cent of its base capital over the years on the back of redemption pressure from the investors.

Fund Basics
Objective	Size (Rs cr)	NAV (Rs) 31/3/2000	Repurchase Price	Sale Price	Total Returns
Tax planning	749	18.16	17.25	—	8.58%
Benchmark Comparisons (%)					29/2/2000
	1M	3M	6M	1Yr	3Yr
Fund	0.46	3.98	1.80	46.31	9.24
Sensex	2.08	17.41	11.83	60.22	14.26
Nat. Index	11.52	46.89	50.80	118.54	27.62
Obj.Avg.	12.26	44.09	62.46	129.77	28.55
Top holdings (31/12/1999)					Net assets (%)
Hindustan Lever					9.73
ITC					7.88
Reliance					6.65
NIIT					6.62
HPCL					5.12
VSNL					5.05
Hindalco					4.86
Infosys					4.49
Vikas WSP					3.62
SmithKline Consumer					3.06
Glaxo					2.81
Gujarat Ambuja					2.67
HDFC					2.15
Reliance Petro					2.02
MTNL					1.83
Hindustan Zinc					1.54
Novartis					1.52
Nestle					1.29
BSES					1.03
Larsen & Toubro					0.94

Mutual Funds

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