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Kothari Pioneer Bluechip

Dhirendra Kumar

Launched in 1993, KP Bluechip seeks investment in well-established companies. Entry into the fund comes with a 2% load, while exit is at NAV. Till 2000, the fund paid a total dividend of 145% in addition to a 1:1 bonus issue in March 2000. In the current calendar, the fund has paid a dividend of 22.5%.

With its diversified blue-chip asset base, KP Blue chip emerges an equity fund for all seasons. This focus has come overtime, for the fund did stay in the red for a while. Launched before the IPO boom, the fund went ballistic with IPO stocks with a rapid gain of 120%, but the party soon ended as the rally went bust.

FUND BASICS   Objective    Size (Cr)    NAV: 09/04/2001    Exit Price    Entry Price    Total Return   Growth   239.01   20.15   20.15   20.56   23.73%

Resurrecting itself with a small asset base, the fund has followed a clearly defined strategy since 1997. In its new avatar, KP Bluechip focussed on well-capitalised liquid companies, which are market leaders. Besides, the fund fancies wealth generating companies, which earn more than the cost of capital and sustain it with good management.

Armed with this strategy the fund has invested in leaders across industry groups to form a diversified portfolio with a preference for technology, pharmaceutical and consumer sectors. The top five sectors in March 2001 are Information technology (20.02%), FMCG (12.06%), Healthcare (9.82%), Banking & Finance (8.66%) and Oil & Gas (8.61%).

   

Benchmark Comparisons (%) on April 9, 2001      1M    3M    6M    1Yr    3Yr   Fund   -11.36   -13.02   -8.35   -22.04   33.91   Nifty Tot. Ret.   -12.93   -13.36   -14.30   -24.00   -4.36   Sensex   -17.77   -21.59   -20.70   -36.97   -2.08   Obj. Avg.   -15.83   -19.49   -21.06   -36.48   5.26

The broad-based portfolio has helped the fund leave its past far behind to outperform the index – in its rise and fall. The fund gained an impressive 179% in 1999, against the sensex gain of 64%. Importantly, the fund held on to this gain in the sliding market of 2000 – the fund lost 13.2% against the Sensex loss of 21%.

With active management and a broad-based portfolio, KP Bluechip has emerged a steady performer. The numbers speak for themselves - an annualised return of 23.73% in its seven-year tenure. With its conservatism, KP Bluechip is not likely to be a blockbuster performer. However, with its low risk growth cap orientation, it is now a worthy candidate for your core portfolio.

   

Top Holdings (30/03/2001)      Value (Cr)    % of Assets   H C L Tech.   19.78   8.28   Infosys Tech.   19.39   8.11   I T C   18.91   7.91   I C I C I   14.99   6.27   TISCO   12.24   5.12   BPCL   11.44   4.78   Hoechst Marion Roussel   11.40   4.77   BHEL   10.42   4.36   HPCL   9.15   3.83   Polaris Software Lab   8.68   3.63   Kirloskar Cummins   7.86   3.29   Larsen & Toubro   7.75   3.24   Hero Honda Motors   7.03   2.94   Indian Hotels Co.   6.47   2.71   Asian Paints   6.16   2.58

Source: Value Research

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