Skip to main content

Mutual Fund Review: Birla Sunlife Frontline Equity Fund

Name: Birla Sunlife Frontline Equity Fund-Growth
Type: Open-Ended Equity Diversified
Fund Manager: Mr. Mahesh Patil & Mr. Nimesh Chandan
Inception Date: August 30, 2002


Birla Sunlife Frontline Equity Fund is an open-end growth scheme from Birla Mutual Fund and seeks to achieve long-term growth of capital, through a portfolio with a target allocation of 100% equity by aiming at being as diversified across various industries and or sectors as its chosen benchmark index, BSE 200. The secondary objective is income generation and distribution of dividend.

It invests in handpicked frontline stocks i.e. stocks which have the potential of providing superior growth opportunities ensuring all leading sectors of its chosen benchmark, thus resulting in a highly diversified portfolio. The scheme targets the same sectoral eights within its portfolio as the benchmark, the BSE 200. However, the fund actively manages the portfolio and has not always limited its choice of stocks to the benchmark providing a wider universe of investible stocks.
 

Though the scheme primarily focuses on top 200 corporates that comprise the benchmark the scheme has managed to deliver the superior performance over its benchmark. Its stock selection along with the momentum picks and rally in largecap stocks has aided the returns. The scheme has posted one year return of 37.5% and has consistently outperformed its benchmark. Its performance has been equally good in last six months and has returned 7.57% while peers lost 1.05%.

 

The scheme has witnessed tremendous growth in its assets under management from Rs 7.8 cr in July 2005 to Rs 81.95 crore as of now. However it has gone down by 50% in last six months. As per stated guidelines it could invest upto100% of its net assets in equity and equity related instruments and as on July 2006, the scheme has allocated 88.63% of its assets in equities and rest in cash and equivalent. Average equity allocation in last one year has been at 91.11% of assets under management of the scheme. However cash exposure of the scheme has gone up in last few months seeing the volatility in the equity markets. It went as high as 22.68% in the month of May when equity markets witnessed sharp correction of 13.6% and again went down to 9.81% when markets showed some signs of recovery in June.
 
 
 
As on July 2006 the scheme has a well diversified spread across 36 stocks and exposure to any single stock is restricted to less than 7%. Top 10 holdings constitute 40.41% of the equity portfolio with Infosys in top place. Other than Infosys top holdings are SBI, Crompton Greaves, Mc Dowell & Company and Syndicate Bank. This month it made fresh exposure to McDowell& Company and Taj GVK Hotels while exited from the stocks of Reliance Energy, IDBI and M&M. Top 5 sectors account for less than half of the equity portfolio and over a period of one year it has further hiked exposure in Diversified, Electrical and Auto sector while trimmed in IT and Banking sector. BHEL, Reliance, Bharti and Infosys has been the fund's top choice in last one year and exposure to Infosys went upto 9% of net assets in equity.
 
Minimum investment required to enter the scheme is Rs 5000 and offers both dividend and growth options. The fund charges an entry load of 2.25% for investment amount less than Rs.5 crore, while no entry load is charged for investment amount equal to or greater Rs.5 crore. The scheme charges an exit load of 1% if redeemed within 6 months from the date of allotment. Expense ratio of the scheme is 2.5% as on June 2006 and is higher than the category average of 2.22%.

The scheme has primarily seen Bull Run but its performance in these three years has been impressive enough. Focussed investment strategy of investing in quality stocks across the leading sectors of the economy makes it a suitable choice for the conservative investors.
 

Popular posts from this blog

Am you Required to E-file Tax Return?

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   Am I Required to 'E-file' My Return? Yes, under the law you are required to e-file your return if your income for the year is Rs. 500,000 or more. Even if you are not required to e-file your return, it is advisable to do so for the following benefits: i) E-filing is environment friendly. ii) E-filing ensures certain validations before the return is filed. Therefore, e-returns are more accurate than the paper returns. iii) E-returns are processed faster than the paper returns. iv) E-filing can be done from the comfort of home/office and you do not have to stand in queue to e-file. v) E-returns can be accessed anytime from the tax department's e-filing portal. For further information contact Prajna Capit...
Read more

IDFC - Long term infrastructure bonds - Tranche 2

IDFC - Long term infrastructure bonds What are infrastructure bonds? In 2010, the government introduced a new section 80CCF under the Income Tax Act, 1961 (" Income Tax Act ") to provide for income tax deductions for subscription to long-term infrastructure bonds and pursuant to that the Central Board of Direct Taxes passed Notification No. 48/2010/F.No.149/84/2010-SO(TPL) dated July 9, 2010. These long term infrastructure bonds offer an additional window of tax deduction of investments up to Rs. 20,000 for the financial year 2010-11. This deduction is over and above the Rs 1 lakh deduction available under sections 80C, 80CCC and 80CCD read with section 80CCE of the Income Tax Act. Infrastructure bonds help in intermediating the retail investor's savings into infrastructure sector directly. Long term infrastructure Bonds by IDFC IDFC issued an earlier tranche of these long term infrastructure bonds on November 12, 2010. This is the second public issue of long-te...
Read more

Section 80CCD

Top SIP Funds Online   Income tax deduction under section 80CCD Under Income Tax, TaxPayers have the benefit of claiming several deductions. Out of the deduction avenues, Section 80CCD provides t axpayer deductions against investments made in specific sector s. Under Section 80CCD, an assessee is eligible to claim deductions against the contributions made to the National Pension Scheme or Atal Pension Yojana. Contributions made by an employer to National Pension Scheme are also eligible for deductions under the provisions of Section 80 CCD. In this article, we will take a look at the primary features of this section, the terms and conditions for claiming deductions, the eligibility to claim such deductions, and some of the commonly asked questions in this regard. There are two parts of Section 80CCD. Subsection 1 of this section refers to tax deductions for all assesses who are central government or state government employees, or self-employed or employed by any other employers. In...
Read more

ULIP Review: ProGrowth Super II

  If you are interested in a death cover that's just big enough, HDFC SL ProGrowth Super II is something worth a try. The beauty is it has something for everybody — you name the risk profile, the category is right up there. But do a SWOT analysis of the basket, and the gloss fades     HDFC SL ProGrowth Super II is a type-II unit-linked insurance plan ( ULIP ). Launched in September 2010, this is a small ticket-size scheme with multiple rider options and adequate death cover. It offers five investment options (funds) — one in each category of large-cap equity, mid-cap equity, balanced, debt and money market fund. COST STRUCTURE: ProGrowth Super II is reasonably priced, with the premium allocation charge lower than most others in the category. However, the scheme's mortality charge is almost 60% that of LIC mortality table for those investing early in life. This charge reduces with age. BENEFITS: Investors can choose a sum assured between 10-40 times the annualised premium...
Read more

FCCB buyback

WITH dismal share valuations causing bondholders to redeem, and not convert their foreign currency convertible bonds ( FCCBs ), which until early this year were regarded as one of the most preferred options for raising corporate debt, suddenly seem to have become millstones around the necks of issuers. It is the redemption pressure on cash-starved issuers, coupled with the need to preserve liquidity by mitigating further forex outflow, which seems to have prompted the Reserve Bank of India ( RBI ) to issue the circular permitting buyback of FCCBs. As per the circular, issuers can now buyback FCCBs under the automatic route up to any limit out of existing foreign resources or by raising fresh external commercial borrowings (ECBs,) if effected at a minimum discount of 15% on the book value. Further, FCCBs up to $50 million can be bought back with prior RBI approval out of rupee resources representing “internal accruals”, if effected at a minimum discount of 25% on the book value. I...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now