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KP Internet Opportunities Fund

Dhirendra Kumar

Kothari Pioneer Internet Opportunities Fund (KPIOF) aims to capitalise on investment opportunities created by rapid growth of internet. Launched in February 2000, the fund raised Rs 555 crore and has a large investor base of over 1.5 lakh investors.

Strategy
The fund broadly invests in technology/software services companies with focus on internet; dot com companies with strong revenue models; convergence plays (media and telecom stocks) and existing companies embracing internet for expanding business. The fund has a small allocation (5%) for unlisted stocks.

Performance
Just about four months old, the fund has been a witness to sharp fall in the indices with the Sensex losing almost 1350 points since February 21. The sharp correction, which coincided with the fund's launch proved to be a blessing in disguise with the fund manager picking up technology stocks at relatively lower levels. The fund has invested Rs 223.36 crore as on April 28 in 26 stocks. Among unlisted companies, the fund has picked up 200,000 shares of Indiainfoline at a price of Rs 295 per share. The fund has benefited with its cash position (51% as on April 28, 2000) with a lower fall in NAV against market. The fund was still under deployment during May 2000. The current portfolio of the fund is in line with its stated with position in ICICI, Mahindra & Mahindra, HLL, HDFC Bank, ICICI Bank and Cadbury.

Outlook
KP Internet Opportunities Fund is building a tech flavoured quality portfolio. The fund is unlikely to be as volatile as a technology fund with lower risk-returns and should prove to be more rewarding than a diversified equity fund with reasonable stability. The fund is an attractive long-term investment for above average returns.

Fund Basics
Objective	Size (Rs cr)	NAV (5/6/2000)	Exit Price	Entry Price	Total Returns (%)
Sector	456.36	8.56	8.56	8.73	-14.40%
Benchmark Comparisons (%)					31/5/00
	1M	3M	6M	1Yr	3Yr
Fund	-6.48	-	-	-	-
Sensex	-5.75	-26.27	3.77	53.54	40.30
Natex	-4.81	-18.60	-4.08	11.86	5.69
Obj. Avg.	-9.98	-34.50	-4.27	25.84	10.19
Top Holdings (28/4/2000)					Net assets (%)
Satyam Computer					7.45
Infosys					7.15
NIIT					5.81
ICICI					3.86
Zee Telefilms					3.04
Hughes Sotware					2.83
HCL Tech					2.69
HLL					1.82
BFL Software					1.54
HDFC					1.53
M & M					1.39
Indiainfoline					1.28
Mastek					1.17
ICICI Bank					1.02
HDFC Bank					0.97

Source: Value Research

Fund File

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