Mutual Fund Review: SBI Magnum Global Fund 94

Type: Open-Ended Equity Diversified
Fund Manager: Mr. Sanjay Sinha.
Inception Date: September 30, 1994

 

SBI Magnum Global Fund 94 has always been in the lime light due to its phenomenal performance across various time frames. It has been the best performing scheme within the fund house product bouquet of equity schemes. The scheme aims to provide the investors an opportunity to earn, in accordance with their requirement, through capital gains or through regular dividends, returns that would be higher than the returns offered by comparable investment avenues through investment in Indian equities, PCDs & FCDs for selected industries.

 

The scheme has been in existence since September 1994 and its fund size has grown at a CAGR of 154% in the last one year period, which shows that the scheme is still popular among the Indian investors. The scheme is currently being managed by Mr. Sanjay Sinha, which was previously managed by Mr. Sandeep Sabharwal. Mr. Sanjay Sinha also manages other equities scheme like SBI Magnum Sector Umbrella – Contra, SBI One India Fund. He also jointly manages other equity scheme of the fund house. The fund invests mainly in large cap and medium cap stocks. It has benchmarked itself against BSE 100.

 

The scheme has a significant exposure of 63% in Mid Cap stocks, 10% in Large Cap, 14% in Small Cap and 13% in other current assets. The scheme has been bullish on the mid cap stocks for quiet some time. Mid-cap space is now trading at a significant discount to their large-cap counterparts, after the sustained appreciation in the latter's prices over the past few months .This certainly makes the scheme more attractive, as it seems to have got its asset allocation strategy right. The fund manager was successful in anticipating the fall and was sitting on 19% cash in the month of May and June 2006 when the market tanked, which has helped the scheme to face the sluggish condition. The scheme has comfortably outperformed its peer and the benchmark. The scheme has invested 86.71% of its assets in equities and 13.29% in cash and equivalent as on December 06.

 

The fund has a good blend of large and mid cap stock. At present the scheme has 53 scrip's in its basket .The top 10 holding accounts for 41% of the total net asset, which indicates how well the portfolio is diversified. Shree Cement Ltd was the top holding and accounted for 6.04% of the net asset. Infotech Enterprises Limited, Ansal Properties & Industries Ltd, JaiPrakash Associates Ltd and Dishman Pharmaceuticals & Chemicals were the other top holdings.

 

The top 5 sector accounts for 50.4% of the portfolio. The Infrastructure sector alone constitutes for 15.55%. The scheme seems to be banking on the booming Infrastructure sector for quite a while, and this strategy has certainly paid rich dividends. Its average exposure to the Infrastructure sector is 15.14 % during the last one year.

 

The fund manager added Gitanjali Gems Ltd and Tanla Solutions Ltd to the current month's portfolio. It further added KEI Industries, Crompton Greaves Ltd and JaiPrakash Associates Ltd to the portfolio. Some of the existing holdings which saw further selling are KEC International Ltd, Matrix Laboratories Ltd and Kajaria Ceramics Ltd.

 

Scheme Name	1 Year
SBI Magnum Global Fund 94 – Growth	58.37
Sundaram BNP Paribas Select Midcap – Growth	58.13
Kotak Global India – Growth	33.6
Birla Mid Cap Fund – Growth	32.48
Tata Midcap Fund – Growth	27.18
ING Vysya Midcap Fund – Growth	24.32
Sahara Midcap Fund – Growth	18.65
DBS Chola Global Advantage Fund – Growth	13.55
PRINCIPAL Global Opportunities Fund – Growth	12.01
Franklin India Smaller Companies Fund – Growth	11.46
Indices
BSE100	44.77

 

Midcap stocks are very notorious for being in the high risk-high return category of equity investment. When mid cap stock appreciates they appreciate more than large cap stock in a bull market, but they are the one sliding down at a blitzkrieg pace in a bearish market. The time has changed and lot of investors have reposed their faith in this category. Investors, who have been pushing the market with large cap buys, are likely to find a safe haven in mid caps, which are doing well financially and are available at cheaper valuation compare to their large cap peers. The scheme seems to be banking on this factor, and hopes to put up a decent performance, investors may continue to hold on to their position in the fund.

 

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7) SBI Mutual Funds:

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9) IDFC Mutual Funds:

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