Women
Partner Channels: Auctions | Auto | Bill Pay | Jobs | Lifestyle | TechJobs | Technology | Travel
February 12, 2001
|
|
|
|
|
|
||
|
Channels: Astrology | Broadband | Chat | Contests | E-cards | Money | Movies | Romance | Search | Weather | Wedding Women Partner Channels: Auctions | Auto | Bill Pay | Jobs | Lifestyle | TechJobs | Technology | Travel |
||
|
|
||
|
Home >
Money > Mutual funds > Fund news February 12, 2001 |
Feedback | |
|
UTI mistimes equity investmentsAabhas Pandya Unit Trust of India seems to be mastering the art of mistiming its equity investments. First, US-64 went tech-savvy at a time when technology stocks had already run up sharply, and now UTI has messed up investments in its "PSU" fund, Mastergrowth '93. By its investment charter, the fund intends to invest at least 50 per cent of its corpus (estimated at Rs 4.32 billion) in PSU stocks. However, with only less than 22 per cent of its investments in government-owned companies in December 2000, the fund has surely missed out on the current spurt in PSU stocks. While the fund has posted a return of only 8.5 per cent since the beginning of the current calendar, the pack of 10 most actively traded PSU stocks has gained an average 27 per cent. With the Budget round the corner, PSU stocks are riding the disinvestment theme on the bourses. The government has already decided to sell its majority stake in CMC (formerly Computer Maintenance Corp) and telecom and internet service major, VSNL. While CMC has gained a hefty 57 per cent since January 1, VSNL has posted a more sober return of 25.3 per cent. However, as of December-end 2000, VSNL is a minuscule 0.34 per cent of Mastergrowth while CMC is not a part of the fund's portfolio. Adding insult to injury, the top PSU holding of the fund, MTNL has gained just 6.84 per cent in the current rally. "Government's decision to divest its stake in VSNL and CMC has further brought optimism on the bourses with heavy purchases in PSU stocks. PSU stocks should continue to move up on hopes of further divestment by the government in other bluechip PSUs,'' say fund managers at Kothari Pioneer. Mastergrowth also holds a mere 11 per cent in the much-fancied public-sector oil companies. Apart from talks of dis-investment, the sooner-than-expected dismantling of the administered pricing mechanism or APM is driving these companies on the bourses. "The removal of APM will give pricing power to oil companies. Already, the government has freed air turbine fuel,'' says a fund manager. Had Mastergrowth stuck to its stated objective of investing at least 50 per cent of assets in PSU stocks, it would have been well geared to capture the current uptrend and deliver impressive returns. However, driven by poor returns of 8.88 per cent since inception and 7.74 per cent in the last five years, the fund's portfolio has changed tack with none of the PSU stocks in the top five holdings. While Reliance Industries is the top pick, HLL, Infosys, ITC and HFCL account for the rest and make up for 52 per cent of the total portfolio. Surely, it is again a case of mis-placed preferences from the mutual fund behemoth.
THE LEADERS...
...AND THE LAGGARD
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
