Risk Return Analysis of Equity Mutual Funds

Risk Return Analysis of Indian Mutual Funds (Equity Schemes only)

Subject: Financial Management

By, Pritesh Keniya

Roll no: 12-15-26 Stream: MFM

INDEX

1. Introduction 1.1 What is Mutual Fund? 1.2 Risks 1.3 Returns 1.4 Indian Mutual Fund Industry

2. Current Data 2.1 Market Analysis for Mutual Funds 2.2 Snapshot of 20 Mutual Fund Schemes

1.1 What are “Mutual Funds”? The phrase “Mutual Funds” if analyzed refers to funds that are raised and invested mutually, i.e. on behalf of everyone participating in the scheme. A mutual fund is a form of collective investment that pools money from investors and invests the money in stocks, bonds, short-term money-market instruments, and/or other securities. In common terms, a mutual fund is a portfolio of stocks, bonds, or other securities that is collectively owned by hundreds or thousands of investors and managed by a professional investment company. The unit holders are people who have similar investment goals. Each fund has specific investment criteria, which are spelt out in its prospectus, the official booklet that describes the mutual fund. Investors then know what they are getting and can match their objective to that of a fund. The pooled money has more buying power than one investor alone, so that a fund can own hundreds of different securities. Thus, its success is not dependent on how just one or two companies perform but on performance of several stocks which fund is holding.

The money thus collected is then invested in capital market instruments such

as shares, debentures and other securities. The income earned through these investments and capital appreciation realized is shared by its unit holders in proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost.

When we talk about all these, one hard fact is about risks that are faced by the Mutual Fund investors. Whenever we see any Mutual Fund offer, there are few statements inevitably found along with that, which is commonly known as "Disclaimer Clause of the Mutual Fund".

Mutual Funds

Returns

Investors

Securities

Generate

Passed to Invest in

Pool their savings

1.2 Risks Every investment entails risk. Mutual funds too are not risk free investments. Even funds investing in government bonds (sovereign paper) are susceptible to some kind of risk. Before investing in mutual funds one must completely understand the risk associated with the particular scheme. Risk is a measure of the possibility that the investor will not receive an expected return on his investment. Generally risk and reward move hand in hand. The greater the risk that an investment may lose money, the greater is its potential for providing a substantial return.

Following are the common types of risk associated with the Mutual Funds: Market risk Market risk exposes one to a potential loss of principal. In all likelihood the market value of a stock will fluctuate based on factors such as developments affecting the company's financial status, earnings of the company or impact of economic slowdown on the company. Likewise, debt funds too are subject to market risk. Prices of bonds and government securities fluctuate with change in interest rates. One can minimise market risk by diversifying among a variety of instruments rather than investing your money in one or two stocks. Diversification helps minimise risks. Thus, when one asset class is adversely affected by market or other conditions, another class may be less affected. Because mutual funds invest in a lot of companies, they are the best way to diversify. Interest Rate Risk The risk that the value of a fixed income security will drop as interest rates rise. Government security prices are inversely related to interest rates. If interest rates decline then the prices of securities increase and vice versa. This risk cannot be avoided. Inflation risk Sometimes referred to as “loss of purchasing power”. Whenever inflation rises forward faster than the earnings on your investment, you run the risk that you will actually be able to buy less, not more. Inflation risk also occurs when prices rise faster than your returns. Business Risk The risk that a company issuing a security may not be financially sound due to factors like poor management, low product demand, or huge operating expenses. Such situations can result in a decline in the security's value. Since mutual funds invest in a variety of companies, the effect of such a risk spreads out.

Credit risk The risk that an issuer will default on a fixed income security by failing to pay interest or principal when due. Most of the bond instruments are rated by rating agencies. The higher the rating given to the bond, the higher is the credit quality implying low credit risk and vice versa. This risk can be limited by investing in mutual funds having a high exposure to quality paper. Rating of AA/AAA denotes high credit quality. Manager Risk This risk arises from the possibility that an actively managed mutual fund's investment adviser will fail to execute the fund's investment strategy effectively, resulting in the failure of the sated objectives. Industry Risk This risk arises from the possibility that a group of stocks in a single industry will decline in price due to developments in that industry. Exchange risk A number of companies generate revenues in foreign currencies and may have investments or expenses also denominated in foreign currencies. Change rates may, therefore, have a positive or negative impact on companies which in turn would have an effect on the investment of the fund. Investment risks The sectoral fund schemes, investments will be predominantly in equities of select companies in the particular sectors. Accordingly, the NAV of the schemes are linked to the equity performance of such companies and may be more volatile than a more diversified portfolio of equities. Changes in the government policy changes in govt. policy especially in regard to the tax benefits may impact the business prospects of the companies leading to an impact on the investment made by the fund. Liquidity Risk The risk that a mutual fund's underlying securities cannot be sold at a fair price when the need arises. Hence marketability of a security is a very important consideration. You can minimise liquidity risk by investing in actively traded companies. In mutual funds, invest in an open-ended scheme as you can enter and exit at your own convenience. Close ended funds do not give you an option to exit at your convenience. Timing risk The risk of buying or selling a security at the wrong time. For example, there is the chance that a few days after you sell a fund it will go up in value or decline in value of a fund after you buy it. As mentioned some of the risks stated above can be avoided through strategic planning.

1.3 Returns There are three primary ways that mutual funds provide returns, or increases in value, for shareholders. These are 1. Dividends, 2. capital gains, and 3. Increase in net asset value. Dividends Mutual fund dividends are distributions of the earnings which a fund receives from the stocks and bonds in its portfolio. Those earnings are comprised of: 1. dividends the fund receives from the portfolio’s stocks 2. interest the fund receives from the portfolio’s bonds and reduced by 1. the costs of operating the fund. Those earnings, both dividends and interest, are then distributed to the shareholders of the mutual fund, as mutual fund dividends. Shareholders can choose to have their dividends: 1. credited as cash to their brokerage account 2. mailed to them in the form of a check 3. used to purchase additional mutual fund shares. Capital Gains Capital gains are the profits that occur when stocks or bonds are sold for more than their acquisition price. When the portfolio manager sells fund assets at a profit, the fund realizes a capital gain. Securities can likewise be sold for a loss. Capital gains distribution is the process of a fund passing on net capital gains realized in the portfolio to its shareholders. Each share of the mutual fund is entitled to an equal portion of the capital gains being distributed. Shareholders can choose to have their capital gains: 1. credited as cash to their account 2. mailed to them in the form of a check 3. used to purchase additional mutual fund shares. Increase in net asset value Increase in net asset value occurs when the value of a fund’s securities exceeds the cost of those securities. Conversely, decrease in net asset value occurs when the cost exceeds the value.

1.4 Indian Mutual Fund Industry History of Indian Mutual Fund Industry The mutual fund industry in India started in 1963 with the formation of Unit Trust of India, at the initiative of the Government of India and Reserve Bank the. The history of mutual funds in India can be broadly divided into four distinct phases First Phase – 1964-87 Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial Development Bank of India (IDBI) took over the regulatory and administrative control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had Rs.6,700 crores of assets under management. Second Phase – 1987-1993 (Entry of Public Sector Funds) 1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks and Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in December 1990. At the end of 1993, the mutual fund industry had assets under management of Rs.47,004 crores. Third Phase – 1993-2003 (Entry of Private Sector Funds) With the entry of private sector funds in 1993, a new era started in the Indian mutual fund industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year in which the first Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first private sector mutual fund registered in July 1993. The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI (Mutual Fund) Regulations 1996. The number of mutual fund houses went on increasing, with many foreign mutual funds setting up funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of assets under management was way ahead of other mutual funds.

Fourth Phase – since February 2003 In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of India with assets under management of Rs.29,835 crores as at the end of January 2003, representing broadly, the assets of US 64 scheme, assured return and certain other schemes. The Specified Undertaking of Unit Trust of India, functioning under an administrator and under the rules framed by Government of India and does not come under the purview of the Mutual Fund Regulations. The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is registered with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of assets under management and with the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with recent mergers taking place among different private sector funds, the mutual fund industry has entered its current phase of consolidation and growth. The graph indicates the growth of assets over the years. GROWTH IN ASSETS UNDER MANAGEMENT

Note: Erstwhile UTI was bifurcated into UTI Mutual Fund and the Specified Undertaking of the Unit Trust of India effective from February 2003. The Assets under management of the Specified Undertaking of the Unit Trust of India has therefore been excluded from the total assets of the industry as a whole from February 2003 onwards.

Structure of Indian Mutual Fund In India, the mutual fund industry is highly regulated with a view to imparting operational transparency and protecting the investor’s interest. In India the structure of a mutual fund is determined by Security Exchange Board of India (SEBI) regulation. These regulations require a fund to be established in the form of a trust under the Indian Trust Act 1882. A mutual fund is typically externally managed it is now an operating company with employees in the traditional sense. Instead a fund relies upon third parties either affiliated organizations or independent contractors to carry out its business activities such as investing in securities. A mutual fund operates through a four-tier structure. The four parties that are required to be involved are sponsor, board of trustees, Asset Management company. Sponsor: A sponsor is a body corporate who establishes a mutual fund. It may be one person acting alone or together with another body corporate. Additionally, the sponsor should contribute at least 40% to the net worth of the AMC. However if any person holds 40% or more of the net worth of an AMC shall be deemed to be a sponsor and will be required to fulfill the eligibility criteria specified in the Mutual Find Regulation. Board of Trustee: Mutual fund requires to have an independent board of Trustee, where two third of the trustees should be independent person who are not associated with the sponsor in any manner. The board of trustees of the trustee company holds the property of the mutual fund in trust for the benefit of the unit holders. The board of trustees is responsible for protecting the unit holder’s interest. Asset Management Company: The role of asset management company is highly significant in the mutual fund operation. They are the fund managers i.e. they invest the investors money in various securities ( equity, debt and money market instruments) after proper research of market conditions and the financial performance of individual companies and specific securities in the efforts to meet or beat average market return and analysis. Mutual funds provide an economical way for the average investor to obtain professional money management and diversification of investments much like large institution and wealthy investors receive. They also look after the administrative functions of a mutual fund for which they charge management fee. Custodian: Mutual fund is required by law to protect their portfolio securities by placing them with a custodian. Nearly all mutual funds use qualified bank custodians. Only a registered custodian under the SEBI regulation can act as a custodian to a mutual fund.

Oraganisation of a Mutual Fund There are many entities involved and the diagram below illustrates the organizational set up of a mutual fund:

Mutual Fund Types

2.1 Market Analysis for Mutual Funds Risk and investing go hand in hand. To know the funds performance, apart from comparing the performance vi-a-vis the benchmarks, an investor should also make use of certain statistical measures that make evaluation of a mutual fund even more precise. Among the most commonly used ratios, there are six ratios, which we come across very often but fail to understand their utility. They are Standard Deviation, Beta, Sharpe, Alpha, Treynor and R-Squared. Standard deviation Standard deviation is a measure of total risks of a fund. In other words it measures the volatility of returns of a fund. It indicates the tendency of the funds NAV to rise and fall in a short period. It measures the extent to which the NAV fluctuates as compared to the average returns during a period. A fund that has a consistent four –year return of 3% for example would have a mean or average, of 3%. The standard deviation for this fund would then be zero because the fund's return in any given year does not differ from its four year mean of 3%. On the other hand, a fund that in each of the last four years returned -5%, 17%, 2%, and 30% will have a mean return of 11%. The fund will also exhibit a high standard deviation because each year the return of the fund differs from the mean return. The fund is therefore more risky because it fluctuates widely between negative and positive returns within a shorter period. A higher standard deviation means that the returns of the fund have been more volatile than a fund having low standard deviation. In other words high standard deviation means high risk. Sharpe ratio The Sharpe ratio represents tradeoff between risk and returns. At the same time it also factors in the desire to generate returns, which are higher than those from risk free returns. Mathematically the Sharpe ratio is the returns generated over the risk free rate, per unit of risk. Risk in this case is taken to be the fund's standard deviation. As standard deviation represents the total risk experienced by a fund, the Sharpe ratio reflects the returns generated by undertaking all possible risks. It is thus one single number, which represents the tradeoff between risks and returns. A higher Sharpe ratio is therefore better as it represents a higher return generated per unit of risk. Sharpe ratio provides an unbiased look into fund's performance. This is because they are based solely on quantitative measures. However, these do not account for any risks inherent in a fund’s portfolio. For example, if a fund is loaded with technology stocks and the sector is performing well, then all quantitative measures will give such a fund high marks. But the possibility of the sector crashing and with it the fund sinking is not calculated. In view of these possibilities quantitative tools should be used along with information on the nature of the funds strategies, its fund management style and risk inherent in the portfolio. Quantitative tools can be used for screening but they should not be the only indicator of a fund's performance.

Beta Beta is a statistical measure that shows how sensitive a fund is to market moves. If the Sensex moves by 25 per cent, a fund's beta number will tell you whether the fund's returns will be more than this or less. The beta value for an index itself is taken as one. Equity funds can have beta values, which can be above one, less than one or equal to one. By multiplying the beta value of a fund with the expected percentage movement of an index, the expected movement in the fund can be determined. Thus if a fund has a beta of 1.2 and the market is expected to move up by ten per cent, the fund should move by 12 per cent (obtained as 1.2 multiplied by 10). Similarly, if the market loses ten per cent, the fund should lose 12 per cent.

Each dot represents a fund's returns plotted against the market returns in the same period. The line is the beta of these returns. While the beta is same in both, it is far more representative of the returns in the left graph then right one. This shows that a fund with a beta of more than one will rise more than the market and also fall more than market. Clearly, if you would like to beat the market on the upside, it is best to invest in a high-beta fund. But you must keep in mind that such a fund will also fall more than the market on the way down. Similarly, a low-beta fund will rise less than the market on the way up and lose less on the way down. When safety of investment is important, a fund with a beta of less than one is a better option. Such a fund may not gain much more than the market on the upside; it will protect returns better when market falls. Essentially, beta expresses the fundamental trade-off between minimizing risk and maximizing return. A fund with a beta of 1 will historically move in the same direction of the market. A beta above 1 is more volatile than the overall market, while a beta below 1 is less volatile. So while you can expect a high return from a fund that has a beta of 2, you will have to expect it to drop much more when the market falls. The effectiveness of the beta depends on the index used to calculate it. It can happen that the index bears no correlation with the movements in the fund. R-Squared (R2) But the problem with beta is that it depends on the index used to calculate it. It can happen that the index bears no correlation with the movements in the fund. Thus, if beta is calculated for large cap fund against a mid-cap index, the resulting value will have no meaning. This is because the fund will not move in tandem with the index. Due to this reason, it is essential to take a look at a statistical value called R-squared along with beta. The R-squared value shows how reliable the beta number is. R-squared values range between 0 and 100, where 0 represents the least correlation

and 100 represents full correlation. If a fund's beta has an R-squared value that is close to 100, the beta of the fund should be trusted. On the other hand, an R-squared value that is close to 0 indicates that the beta is not particularly useful because the fund is being compared against an inappropriate benchmark. Thus, an index fund investing in the Sensex should have an R-squared value of one when compared to the Sensex. For equity diversified funds, an R-squared value greater than 0.8 is generally accepted to mean that the underlying beta value is reliable and can be used for the fund. Alpha The Alpha measure is less about risk than it is about "value added." Alpha represents the difference between the performance you would expect from a fund, given its Beta, and the actual returns it generates. A high alpha (more than 1) means that the fund has performed well. A negative alpha means the fund under performed. Mathematically, Alpha= fund return - [Risk free rate + Beta of fund (Benchmark return - Risk free return)] Treynor The Treynor ratio is similar to the Sharpe ratio. Instead of comparing the fund’s risk adjusted performance to the risk free return, it compares the fund’s risk adjusted performance of the relative index.

2.2 Snapshot of 20 Mutual Fund Schemes We would analyze the following 20 schemes on basis of above mentioned ratios in Market Analysis of Mutual Funds: 1. SBI Magnum Sector Umbrella - Contra Fund – Growth 2. Reliance Growth - Growth 3. SBI Magnum Multiplier Plus 93 – Growth 4. Sundaram BNP Paribas Select Midcap - Growth 5. ICICI Prudential Dynamic Plan – Growth 6. ICICI Prudential FMCG – Growth 7. Reliance Banking Fund – Growth 8. Birla Sun Life Buy India Fund – Growth 9. Franklin FMCG Fund – Growth 10. DSP BlackRock Technology.com Fund - Regular – Growth 11. HDFC Index Fund - Sensex Plus Plan 12. ICICI Prudential Index Fund 13. UTI Master Index Fund – Growth 14. Tata Index Fund - Nifty Plan - Option A 15. UTI Nifty Fund – Growth 16. SBI Magnum Tax Gain Scheme 93 – Growth 17. Sundaram BNP Paribas Taxsaver - (Open Ended Fund) – Growth 18. HDFC Taxsaver – Growth 19. ICICI Prudential Taxplan - Growth 20. Franklin India Taxshield - Growth

SBI Magnum Sector Umbrella - Contra Fund – Growth Current Stats & Profile Latest NAV 27.61 (18/02/09) 52-Week High 52.15 (19/02/08) 52-Week Low 25.48 (27/10/08) Fund Category Equity: Diversified Type Open End Launch Date July 1999 Risk Grade Below Average Return Grade High Net Assets (Cr) 1,664.23 (31/01/09) Benchmark BSE 100

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -5.51 -7.60 1-Month -3.29 -3.47 3-Month 1.69 -1.12 1-Year -47.12 -50.14 3-Year 0.36 -6.37 5-Year 24.34 10.70 Return Since Launch 22.35 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style

Sector Weightings As on 31/01/09 % Net Assets

Energy 17.27

Financial 12.65

FMCG 6.03

Automobile 5.97

Engineering 5.61

Metals 5.43

Technology 5.09

Diversified 4.83

Construction 4.25

Communication

3.14

Services 2.91

Health Care 2.26

Chemicals 1.22

Statistical Ratios Standard Deviation 31.83Sharpe Ratio 0.05Jenson Ratio -0.0224Treynor Ratio 0.1237R-Square 0.94Alpha 3.10Beta 0.98

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 4.73ICICI Bank Equity 4.57State Bank of India Equity 3.8ITC Equity 3.53HPCL Equity 3.11

Reliance Growth - Growth Current Stats & Profile Latest NAV 197.9437 (18/02/09) 52-Week High 383.6 (27/02/08) 52-Week Low 195.08 (02/12/08) Fund Category Equity: Diversified Type Open End Launch Date October 1995 Risk Grade Average Return Grade High Net Assets (Cr) 3,253.81 (31/01/09) Benchmark BSE 100

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -8.57 -7.60 1-Month -3.98 -3.47 3-Month -3.35 -1.12 1-Year -48.11 -50.14 3-Year -1.07 -6.37 5-Year 20.22 10.70 Return Since Launch 25.00 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style

Sector Weightings

As on 31/01/09 % Net Assets Financial 8.26

Health Care 7.67

Energy 5.93

Technology 5.74

Chemicals 5.14

Diversified 4.76

FMCG 4.65

Metals 4.52

Communication 3.91

Automobile 1.70

Services 1.48

Engineering 1.17


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Lupin Equity 3.85Divi's Laboratories Equity 3.83Reliance Industries Equity 3.45Infosys Technologies Equity 3.27Bank of Baroda Equity 3.12

http://www.valueresearchonline.com/stocks/snapshot.asp?code=2240

SBI Magnum Multiplier Plus 93 - Growth Current Stats & Profile Latest NAV 37.74 (18/02/09) 52-Week High 72.7 (19/02/08) 52-Week Low 35.77 (02/12/08) Fund Category Equity: Diversified Type Open End Launch Date February 1993 Risk Grade Average Return Grade Above Average Net Assets (Cr) 604.61 (31/01/09) Benchmark BSE 100

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -5.46 -7.60 1-Month -2.68 -3.47 3-Month 1.89 -1.12 1-Year -48.09 -50.14 3-Year -2.29 -6.37 5-Year 19.07 10.70 Return Since Launch 11.45 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style


Engineering 14.13

FMCG 8.78

Energy 7.03

Health Care 6.62

Financial 6.55

Chemicals 5.59

Automobile 4.33

Services 4.27

Construction 3.51

Diversified 3.50

Metals 2.84

Technology 1.17

Textiles 0.54

Statistical Ratios Standard Deviation 30.75Sharpe Ratio -0.05Jenson Ratio -0.0100Treynor Ratio 0.1230R-Square 0.89Alpha -0.16Beta 0.93

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets BHEL Equity 6.39Crompton Greaves Equity 4.27 Blue Dart Express Equity 4.13Nestle India Equity 4.01Lupin Equity 3.88






Sundaram BNP Paribas Select Midcap - Growth Current Stats & Profile Latest NAV 53.3451 (18/02/09) 52-Week High 118.3472 (19/02/08) 52-Week Low 53.3451 (18/02/09) Fund Category Equity: Diversified Type Open End Launch Date July 2002 Risk Grade Average Return Grade Above Average Net Assets (Cr) 914.12 (31/01/09) Benchmark BSE Mid Cap


Fund Style

Sector Weightings


Services 13.18

Construction 8.55

Health Care 7.40

Metals 5.79

Chemicals 5.51

Diversified 5.09

FMCG 4.11

Engineering 4.03

Energy 3.63

Textiles 1.22

Cons Durable 0.67

Communication 0.48

Statistical Ratios Standard Deviation 33.80Sharpe Ratio -0.09Jenson Ratio 0.0293Treynor Ratio 0.1385R-Square 0.80Alpha -1.64Beta 0.96

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Bank of Baroda Equity 4.03Indraprastha Gas Equity 3.74Hindustan Construction Equity 3.69Canara Bank Equity 3.57Tata Tea Equity 3.50






ICICI Prudential Dynamic Plan - Growth Current Stats & Profile Latest NAV 47.6261 (18/02/09) 52-Week High 80.3423 (05/05/08) 52-Week Low 43.4592 (27/10/08) Fund Category Equity: Diversified Type Open End Launch Date October 2002 Risk Grade Average Return Grade High Net Assets (Cr) 1,047.37 (31/01/09) Benchmark S&P CNX Nifty

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -6.89 -7.60 1-Month -3.19 -3.47 3-Month 3.09 -1.12 1-Year -39.97 -50.14 3-Year 1.90 -6.37 5-Year 17.06 10.70 Return Since Launch 27.90 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style

Sector Weightings


Energy 11.85

Health Care 10.24

Communication 9.75

FMCG 8.89

Technology 7.67

Metals 6.64

Engineering 5.76

Diversified 5.22

Chemicals 3.63

Construction 1.74

Services 0.82

Textiles 0.65

Automobile 0.40

Statistical Ratios Standard Deviation 29.89Sharpe Ratio 0.08Jenson Ratio 0.0193Treynor Ratio 0.1083R-Square 0.89Alpha 3.81Beta 0.90

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Bharti Airtel Equity 9.19Reliance Industries Equity 5.12 ICICI Bank Equity 4.83BHEL Put Option 3.74ITC Equity 3.48





ICICI Prudential FMCG - Growth Current Stats & Profile Latest NAV 31.18 (18/02/09) 52-Week High 50.31 (05/05/08) 52-Week Low 28.59 (27/10/08) Fund Category Equity: FMCG Type Open End Launch Date March 1999 Risk Grade Not Rated Return Grade Not Rated Net Assets (Cr) 44.50 (31/01/09) Benchmark S&P CNX FMCG

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -2.01 -2.16 1-Month -1.17 -1.20 3-Month 5.09 5.11 1-Year -36.15 -24.87 3-Year -4.12 -4.80 5-Year 20.51 14.94 Return Since Launch 12.17 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style


FMCG 76.21 Chemicals 18.80

Textiles 0.74


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets ITC Equity 22.66ITC Futures 15.88Marico Equity 14.99 Gillette Equity 13.38Pidilite Industries Equity 10.22


Reliance Banking Fund - Growth Current Stats & Profile Latest NAV 35.2219 (18/02/09) 52-Week High 64.18 (19/02/08) 52-Week Low 34.8187 (27/10/08) Fund Category Equity: Banking Type Open End Launch Date May 2003 Risk Grade Not Rated Return Grade Not Rated Net Assets (Cr) 669.94 (31/01/09) Benchmark CNX Banks

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -14.47 -15.25 1-Month -9.20 -9.14 3-Month -5.49 -7.77 1-Year -45.28 -52.87 3-Year 4.66 2.64 5-Year 14.99 14.99 Return Since Launch 24.48 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style


Financial 76.63


Top 5 Holdings as on 31/01/09

Name of Holding Instrument % Net Assets

Others Cash/Call/Net Receivables 19.99

State Bank of India Equity 16.77 ICICI Bank Equity 11.40 Bank of Baroda Equity 8.10 Punjab National Bank Equity 7.87





Birla Sun Life Buy India Fund - Growth Current Stats & Profile Latest NAV 17.87 (18/02/09) 52-Week High 30.83 (27/02/08) 52-Week Low 17.05 (27/10/08) Fund Category Equity: Diversified Type Open End Launch Date January 2000 Risk Grade Below Average Return Grade Average Net Assets (Cr) 31.65 (31/01/09) Benchmark BSE 200


Fund Style

Sector Weightings


FMCG 17.85

Health Care 17.54

Services 15.17

Automobile 11.21

Diversified 10.40

Communication 4.24


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Rallis India Equity 6.68Glaxosmithkline Pharma Equity 6.66

Maruti Suzuki India Equity 5.82 State Bank of India Equity 5.72 Bosch Equity 5.39







Franklin FMCG Fund - Growth Current Stats & Profile Latest NAV 30.9217 (18/02/09) 52-Week High 40.598 (06/05/08) 52-Week Low 28.3299 (27/10/08) Fund Category Equity: FMCG Type Open End Launch Date March 1999 Risk Grade Not Rated Return Grade Not Rated Net Assets (Cr) 21.15 (31/01/09) Benchmark ET Brandex


Fund Style


FMCG 75.85 Chemicals 15.45 Services 2.01


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Nestle India Equity 15.41Hindustan Unilever Equity 12.73ITC Equity 11.16Asian Paints Equity 9.37 Marico Equity 8.73






DSP BlackRock Technology.com Fund - Regular - Growth Current Stats & Profile Latest NAV 13.351 (18/02/09) 52-Week High 28.959 (16/05/08) 52-Week Low 13.314 (23/01/09) Fund Category Equity: Technology Type Open End Launch Date April 2000 Risk Grade Not Rated Return Grade Not Rated Net Assets (Cr) 55.94 (31/01/09) Benchmark BSE Teck


Fund Style

Sector Weightings

As on 31/01/09 % Net Assets Technology 42.15 Communication 26.66 Services 5.42 Engineering 1.29

Statistical Ratios Standard Deviation 32.48Sharpe Ratio -0.17Jenson Ratio 0.0703Treynor Ratio 0.1427R-Square 0.58Alpha 8.88Beta 0.82

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Bharti Airtel Equity 22.55 Infosys Technologies Equity 19.68 Net Receivables Cash 17.15Allied Digital Services Equity 7.41

Others Reverse Repo/CBLO 7.33




HDFC Index Fund - Sensex Plus Plan Current Stats & Profile Latest NAV 105.3363 (18/02/09) 52-Week High 190.6818 (19/02/08) 52-Week Low 102.8743 (23/01/09) Fund Category Equity: Diversified Type Open End Launch Date July 2002 Risk Grade Below Average Return Grade Above Average Net Assets (Cr) 29.09 (31/01/09) Benchmark Sensex


Fund Style

Sector Weightings

As on 31/01/09 % Net Assets

Financial 24.17 Energy 14.15 FMCG 13.56

Technology 9.97

Communication 8.07 Health Care 7.68 Diversified 5.40 Automobile 4.15 Services 2.41 Metals 1.49 Engineering 1.28

Construction 0.88

Statistical Ratios Standard Deviation 27.63Sharpe Ratio -0.02Jenson Ratio -0.0021Treynor Ratio 0.1094R-Square 0.98Alpha 0.62Beta 0.87

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 9.50Infosys Technologies Equity 7.65State Bank of India Equity 7.32 Bharti Airtel Equity 7.23 ICICI Bank Equity 6.71






ICICI Prudential Index Fund Current Stats & Profile Latest NAV 25.5956 (18/02/09) 52-Week High 47.772 (28/02/08) 52-Week Low 23.196 (27/10/08) Fund Category Equity: Index Type Open End Launch Date February 2002 Risk Grade Below Average Return Grade High Net Assets (Cr) 33.55 (31/01/09) Benchmark S&P CNX Nifty


Fund Style

Sector Weightings


Energy 21.05 Financial 6.71 Communication 5.45

Technology 4.96

FMCG 3.72

Engineering 2.65

Metals 2.63

Construction 1.66 Diversified 1.53

Automobile 1.44

Health Care 1.38 Services 0.14


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Nifty Futures 46.35 Reliance Industries Equity 6.20 NTPC Equity 4.66 ONGC Equity 4.17 Bharti Airtel Equity 3.58





UTI Master Index Fund - Growth Current Stats & Profile Latest NAV 27.9402 (18/02/09) 52-Week High 56.3756 (19/02/08) 52-Week Low 26.2343 (20/11/08) Fund Category Equity: Index Type Open End Launch Date June 1998 Risk Grade Below Average Return Grade Average Net Assets (Cr) 35.76 (31/01/09) Benchmark Sensex


Fund Style

Sector Weightings


Energy 24.98 Financial 21.24

Technology 11.74

FMCG 10.76

Communication 7.71 Diversified 7.08

Metals 3.28 Engineering 3.21

Automobile 2.62

Health Care 1.78

Construction 1.38


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 14.77Infosys Technologies Equity 9.01 ITC Equity 6.73ICICI Bank Equity 6.57Bharti Airtel Equity 5.97






Tata Index Fund - Nifty Plan - Option A Current Stats & Profile Latest NAV 16.7493 (18/02/09) 52-Week High 32.2182 (28/02/08) 52-Week Low 15.337 (27/10/08) Fund Category Equity: Index Type Open End Launch Date February 2003 Risk Grade Above Average Return Grade Above Average Net Assets (Cr) 5.50 (31/01/09) Benchmark S&P CNX Nifty


Fund Style

Sector Weightings


Energy 36.83 Financial 11.38

Communication 10.27 Technology 9.23 Metals 6.18 Engineering 5.26

FMCG 5.05 Construction 4.15

Diversified 3.58

Automobile 2.67



Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 11.42ONGC Equity 8.94Bharti Airtel Equity 6.08 NTPC Equity 5.79State Bank of India Equity 3.78






UTI Nifty Fund - Growth Current Stats & Profile Latest NAV 17.5202 (18/02/09) 52-Week High 33.4009 (19/02/08) 52-Week Low 16.0391 (27/10/08) Fund Category Equity: Index Type Open End Launch Date March 2000 Risk Grade Average Return Grade Above Average Net Assets (Cr) 174.44 (31/01/09) Benchmark S&P CNX Nifty


Fund Style

Sector Weightings


Energy 38.98 Financial 12.42 Communication 10.09

Technology 9.19

FMCG 6.89

Engineering 4.91

Metals 4.88

Construction 3.08 Diversified 2.83

Automobile 2.67



Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 11.49 NTPC Equity 8.62 ONGC Equity 7.73Bharti Airtel Equity 6.64 Infosys Technologies Equity 4.13






SBI Magnum Tax Gain Scheme 93 - Growth Current Stats & Profile Latest NAV 29.24 (18/02/09) 52-Week High 58.98 (19/02/08) 52-Week Low 27.69 (20/11/08) Fund Category Equity: Tax Planning Type Open End Launch Date March 1993 Risk Grade Below Average Return Grade High Net Assets (Cr) 2,394.53 (31/01/09) Benchmark BSE 100

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -5.65 -7.20 1-Month - 2.66 - 3.28 3-Month 1.14 - 1.22 1-Year -50.47 -49.93 3-Year -3.67 -8.00 5-Year 23.67 10.43 Return Since Launch 15.94 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style

Sector Weightings

As on 31/01/09 % Net Assets Energy 16.07

Financial 14.75

Engineering 7.17

Metals 6.39

Diversified 5.98

Construction 4.99

Communication 3.63

Technology 2.56

Chemicals 2.26

Health Care 2.18

FMCG 1.61

Automobile 1.54

Services 1.20


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 4.39HDFC Equity 3.28State Bank of India Equity 3.24ICICI Bank Equity 2.77Larsen & Toubro Equity 2.77

Sundaram BNP Paribas Taxsaver - (Open Ended Fund) - Growth Current Stats & Profile Latest NAV 22.104 (18/02/09) 52-Week High 38.5737 (19/02/08) 52-Week Low 21.9122 (20/11/08) Fund Category Equity: Tax Planning Type Open End Launch Date November 1999 Risk Grade Below Average Return Grade High Net Assets (Cr) 505.80 (31/01/09) Benchmark BSE 200


Fund Style


Financial 22.12

Energy 17.13

FMCG 13.04

Health Care 10.75

Technology 4.15

Automobile 2.49

Services 2.28

Construction 2.26

Metals 2.23

Diversified 2.04

Statistical Ratios Standard Deviation 30.48Sharpe Ratio -0.01Jenson Ratio -0.0147Treynor Ratio 0.1294R-Square 0.87Alpha 1.14Beta 0.91

Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets ITC Equity 5.08Hindustan Unilever Equity 4.91 ICICI Bank Equity 4.74Glaxosmithkline Pharma Equity 4.28

Punjab National Bank Equity 4.23



HDFC Taxsaver - Growth Current Stats & Profile Latest NAV 91.493 (18/02/09) 52-Week High 174.597 (19/02/08) 52-Week Low 87.542 (20/11/08) Fund Category Equity: Tax Planning Type Open End Launch Date March 1996 Risk Grade Below Average Return Grade Above Average Net Assets (Cr) 962.48 (31/01/09) Benchmark S&P CNX 500

Trailing Returns As on 18 Feb 2009 Fund Category Year to Date -7.56 -7.20 1-Month -3.79 -3.28 3-Month 0.05 -1.22 1-Year -47.33 -49.93 3-Year -7.38 -8.00 5-Year 17.19 10.43 Return Since Launch 30.19 -- Returns upto 1 year are absolute and over 1 year are annualised.

Fund Style

Sector Weightings


Health Care 11.35

FMCG 11.10

Energy 9.84

Technology 8.56

Services 7.78

Automobile 7.70

Engineering 5.95

Chemicals 3.71

Communication 3.18

Metals 3.17

Diversified 1.30

Construction 0.94


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets ICICI Bank Equity 6.05State Bank of India Equity 5.75Dr. Reddy's Lab Equity 3.96BPCL Equity 3.89 Infosys Technologies Equity 3.42






ICICI Prudential Taxplan - Growth Current Stats & Profile Latest NAV 52.65 (18/02/09) 52-Week High 106.56 (19/02/08) 52-Week Low 49.88 (25/11/08) Fund Category Equity: Tax Planning Type Open End Launch Date August 1999 Risk Grade Above Average Return Grade Average Net Assets (Cr) 482.23 (31/01/09) Benchmark S&P CNX Nifty


Fund Style

Sector Weightings


Energy 9.75

Health Care 9.67

Communication 9.37

Chemicals 8.50

Engineering 7.64

FMCG 7.60

Metals 6.62

Technology 4.69

Construction 4.58

Textiles 1.91

Services 1.54

Diversified 1.33

Automobile 1.28


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Bharti Airtel Equity 9.02Punjab National Bank Equity 5.91 Corporation Bank Equity 5.75Reliance Industries Equity 5.58Cadila Healthcare Equity 5.24






Franklin India Taxshield - Growth Current Stats & Profile Latest NAV 92.6063 (18/02/09) 52-Week High 168.4945 (19/02/08) 52-Week Low 89.0428 (20/11/08) Fund Category Equity: Tax Planning Type Open End Launch Date April 1999 Risk Grade Low Return Grade Above Average Net Assets (Cr) 369.77 (31/01/09) Benchmark S&P CNX 500


Fund Style

Sector Weightings


FMCG 15.83

Engineering 10.36

Communication 8.45

Technology 7.70

Energy 7.57

Diversified 5.09

Health Care 5.02

Automobile 4.04

Services 3.61

Chemicals 3.40

Construction 0.57


Top 5 Holdings as on 31/01/09 Name of Holding Instrument % Net Assets Reliance Industries Equity 7.12Bharti Airtel Equity 6.86Infosys Technologies Equity 5.66 BHEL Equity 5.36HDFC Equity 5.16






Risk Return Analysis of Equity Mutual Funds

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