From THE HINDU group of publications
Sunday, July 08, 2001


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Kotak Mahindra K-30: Hold

Recommendation: Hold

Aarati Krishnan

INVESTORS in K-30 can retain their investments for now.

Kotak Mahindra Mutual Fund's diversified equity fund K-30 has underperformed the BSE Sensitive Index over the past six months. The fund also underperformed the majority of its peers over this period. However, the performance in the preceding year has been quite reasonable. With the equity markets at a low ebb, this appears to be a bad time to exit a diversified fund.

Between March 31 and May 31 2001, the fund appears to have booked profit in several cyclical stocks, while enhancing exposure to FMCG stocks. The following changes took place in the portfolio between March and May:

Stocks added: The fund acquired new exposures in Britannia Industries, ICICI and Reliance Petroleum.

Stocks sold: The fund completely liquidated its holdings in E- Serve International, Knoll Pharmaceuticals, LG Balakrishnan Brothers and Blue Star. The exclusion of the last two stocks reduced the fund's exposure in engineering stocks to nil.

Holdings enhanced: The fund stepped up its exposures in SSI, Novartis, Reliance Industries and Bharat Petroleum during the period, acquiring additional shares in these companies.

Holdings pared: The fund brought down its exposure to Satyam Computers and Polaris Software within the IT sector. This brought down the IT exposure from 14.4 per cent of net assets in March 2001 to 13.4 per cent in May 2001. The fund also booked profits in all of its cement holdings _ L&T, ACC and India Cements. Part of the holdings in Cipla, Ranbaxy and HDFC bank were pared. The fund cut exposures in VSNL, M&M, Zee Telefilms, Hindalco and Hindustan Inks and Resins by selling part of its holdings in these stocks.

Sectoral profile: As a result of the above changes, FMCG has come to take up the highest sectoral allocation in the fund. Exposure to the sector amounted to 17.9 per cent in May 2001. IT stocks and pharmaceuticals were the next largest sectoral exposures at 13.4 and 12.7 per cent respectively. Finance companies and diversified conglomerates were the other significant sectoral exposures, while the balance was spread across petroleum, telecom, auto, metals and chemicals. The fund held a cash position of around 11.25 per cent by end of May 2001.

(This column tracks recent changes in the top exposures of various mutual funds. The latest available portfolio is compared with that of the preceding month/quarter.)

Section  : Mutual Funds
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