The Hindu Business Line : DSP Merrill plans to diversify tech fund

DSP Merrill Lynch MF may modify its technology fund to create a more diversified product, one that can invest in various other sectors. The issue of changing the scheme's investment objectives will shortly come under review.

DSP ML, according to Mr Alok Vajpeyi, President, would like to ensure that the interests of its investors are protected before the changeover can be taken up formally. In recent times, the fund has done well vis-à-vis some of its peers and at the moment there is no concrete proposal on a revision, he added.

Launched in May 2000, DSP ML Technology.com Fund essentially sticks to tech and tech-dependent companies. It is currently invested in areas such as IT consulting & services, computer hardware, telecom services and electrical equipment.

Mr Anup Maheshwari, Head - Equities, said the fund has lately displayed positive signs, after having benefited from an active stock-picking strategy. Its net asset value (now over Rs 8) has been rising, based on advances recorded by select IT counters. The fund, for instance, has gained from its investment in Bharti Tele, a stock that has registered decent gains in recent times.

DSP ML Technology.com has recorded around 100 per cent in the past one-year period, which compares favourably with its benchmark, the BSE TECk Index, which has moved up by about 48 per cent.

The MF is also aware that a few other fund houses had taken up similar moves in the past. Included in this group are players like Birla Sun Life, Cholamandalam, Templeton and IL&FS. Their tech funds are now called Birla India Opportunities Fund, Chola Opportunities Fund, Franklin India Opportunities Fund and IL&FS Global.

On another front, DSP ML MF is working towards managing resources on behalf of high networth individuals. It is designing a portfolio management service, for which it has approached SEBI for approval. The MF is also looking at a situation where it provides fund management solutions to institutions, including insurance companies, Mr Vajpeyi maintained.

Talks are proceeding with a number of parties.