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Canpep '94

Dhirendra Kumar

Canpep '94 is a close-ended equity-linked, tax-saving scheme due for redemption in March 2004. The scheme is open for repurchase at a 5 per cent discount to the previous week's net asset value (NAV). The fund has not declared any dividend till date. Canpep '94 has yielded an annualised return of 7.7 per cent since its launch against the Sensex return of 5.2 per cent.

Launched in March 1994, the fund invested at higher levels of the 1994 rally. Portfolio allocation saw the fund pick up large-cap and mid-cap stocks in addition to its initial public offer (IPO) picks. The IPO rally of 1994 took the fund's NAV to a high of Rs 13. However, with the boom going bust, the fund slipped below par and went as low as Rs 5.85.

With gradual restructuring, the fund had weeded out a number of junk stocks but consolidated its cyclical exposure, which accounted for 58 per cent of its portfolio in 1998. This trend was reversed by March 1999 when the cyclicals constituted only a third of the net assets and the rest was invested in the growth sectors of FMCG, pharma and infotech.

While the restructuring helped the fund outperform the Sensex from April 1998 onwards, it crawled back to its par value of Rs 10 by December 1999 and has been up since. In the year and quarter ending March 2000, the fund has yielded 113 per cent and 33 per cent respectively. As on September 1999, it was overweight on the software sector (43.5%), other prominent sectors were FMCG (13%), pharma (9%), auto (9%) and electronics (16%). The fund has a 15 per cent exposure to NIIT and 12% in Nestle India.

Canpep '94 can give favourable returns, but with its concentrated bets in infotech sector, it would be volatile. Also, with economy stocks starting to find favour with the market, this augurs well for the fund.

Fund Basics
Objective	Size (Rs cr)	NAV (Rs) 23/3/2000	Market Price	Discount (%)	Total Returns
Tax planning	12	14.66	8.00	-45.43	7.70%
Benchmark Comparisons (%)					29/2/2000
	1M	3M	6M	1Yr	3Yr
Fund	7.22	18.86	17.51	79.53	24.80
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 (30/9/1999)					Net assets (%)
NIIT					15.32
Nestle					11.96
Polaris					10.35
Ranbaxy					8.61
SSI					6.59
Thermax					6.05
BHEL					5.51
Mahindra & Mahindra					5.51
MTNL					4.84
India Cements					4.17

Mutual Funds

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