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Fund Pick: Kothari Pioneer Infotech Fund

The first information technology sector fund Kothari Pioneer Infotech Fund has declared yet another dividend this year of 60 per cent, in its dividend option, for all investors as on March 24, 2000.

The fund had earlier declared a 40 per cent dividend in October 1999 and also a 60 per cent dividend along with a 1:1 bonus issue in January 2000. For the short-term investors, the dividend will entail a cost of 2 per cent exit load besides assuming the market risk and an entry load of 2 per cent.

Since its launch in August 1998, Kothari Pioneer Infotech Fund went ballistic gaining 824 per cent till date resulting in an annualised return of 316 per cent since its launch.

The fund's portfolio has largely remained static with changes in scrip weightage. The fund has assumed a marginal position in 123India.com, an unlisted company. It has added Polaris Software and Hughes Software in the past few months.

The fund has a highly concentrated portfolio spread over 25 infotech stocks. The top six holdings of the fund, Satyam, Infosys, Mastek, HCL Technologies, BFL Software and Wipro, account for 67.3 percent of the net assets.

The fund with its sectoral focus and concentration has been very volatile in its brief history. In its dealing history of 569 days, it has gained by more than 2 per cent on 96 occasions in a day and lost more than 2 per cent on 46 days over its previous day's net asset value.

Launched in August 1998, the fund raised Rs 7 crore in its initial subscription period and as on February 29, 2000, it has Rs 741 crore of assets under management. Given the bright outlook for infotech stocks, Kothari Pioneer Infotech Fund has the potential to deliver above average returns. However, the fund is not suited for conservative investors seeking steady returns, as the volatility can be very high. A regular investment plan in an infotech fund can help reap benefits of the boom in IT sector with greater ease.

Fund Basics
Objective	Size (Rs cr)	NAV (Rs): 14/3/2000	Exit Price	Entry Price	Total Returns
Sector	708	44.81	44.81	45.71	316.0%
Benchmark Comparisons (%)					29/2/2000
	1M	3M	6M	1Yr	3Yr
Fund	24.2	91.0	229.6	440.3	NA
Sensex	4.6	17.8	11.2	60.2	NA
Nat. Index	14.5	46.2	50.2	118.5	NA
Obj. Avg.	6.4	45.7	77.3	224.3	72.1
Top Holdings (29/02/2000)			Value (Rs cr.)		Net Assets (%)
Satyam Computer			186.15		25.12
Infosys			101.45		13.69
Mastek			56.69		7.65
HCL Tech			56.54		7.63
BFL Software			54.91		7.41
Wipro			42.91		5.79
NIIT			40.76		5.50
Hughes Software			31.86		4.30
Digital			29.34		3.96
SSI			28.31		3.82
Ramco Systems			15.04		2.03
Polaris Software			13.71		1.85
Sierra Optima			11.34		1.53
Aptech			9.93		1.34
Sonata Software			9.71		1.31
Visual Soft			8.08		1.09
PSI Data			6.22		0.84
Ramco			4.52		0.61
Subex Systems			4.15		0.56
VJIL Consulting			2.37		0.32

Source: Value Research

Mutual Funds

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