After rising by roughly 30% (Sensex) in 2014, the equity market seems to have lost steam. The six-month period ended June 30, 2015 was marred by bouts of volatility – a stark reminder to investors never to look at the short term when buying stocks. During this period, the Sensex rose by 1% and the BSE Midcap, 3%. On the flip side, the BSE Smallcap index posted a marginal loss of 0.1%.
Here we present the best and worst funds over the first six months of this calendar year: January 1 - June 30, 2015.
Morningstar India Large-Cap Category: 2.4%
Category benchmark (BSE 100): 1.3%
Out of 114 funds from the category, 74% fared better than the benchmark index. A study of the portfolios reveal that financial services (category average 29%), consumer cyclicals (14%) and technology (13%) were the top sectors.
The best performer was BNP Paribas Equity (8.1%) which beat the category norm by nearly six percentage points. Stocks such as HDFC Bank, Bharti Airtel and Lupin Laboratories played out well for the fund. Worth noting is that SBI Bluechip at 8% was just as impressive. Motilal Oswal MOSt Focussed 25 found itself at third place with a 7.7% return.
Baroda Pioneer PSU Equity was the category’s worst performer at -6.3%. The fund’s investments in SBI and Oil India detracted from its showing. Sundaram Growth (-4.35%) and UTI Dividend Yield (-3.5%) also found themselves at the bottom.
Morningstar India Small/Mid-Cap Category: 4.4%
Category benchmark (CNX Mid Cap): 3.4%
Out of the 45 small/mid-cap funds considered, 64% fared better than the CNX Mid Cap index. In terms of sector holdings for the category, industrials (20%), financial services (19%) and consumer cyclicals (19%) were the favourites.
There was a rather stark gap between the best and worst performers in this category.
Motilal Oswal MOSt Focussed Midcap 30 emerged as the best-performing fund with a robust appreciation of 15.8%; the fund outscored the category average by over 11 percentage points. The fund’s bets in stocks such as Ajanta Pharma, Bajaj Finance and Page Industries aided the performance. Birla Sun Life MNC (15.5%) came in a close second with a strong showing, followed by BNP Paribas Mid Cap (10.5%).
The fund with the heaviest losses was Sahara Star Value at -8.2%. The fund shed more than 9% over the 1-year period ended June 30, 2015. The portfolio manager’s exposure to basic materials, technology and financial services failed to deliver, specifically stocks such as UCO Bank, Mastek and Mangalam Cement. Sahara Midcap (-3.2%) and Birla Sun Life Pure Value (-2.6%) were also the other laggards.
Morningstar India Flexi-Cap Category: 3.5%
Category benchmark (S&P BSE 500): 1.7%
These funds should theoretically be better performers since they have the freedom to invest across the market-cap spectrum, thereby affording portfolio managers flexibility while investing in terms of market cap restrictions. Of the 72 funds of this category, roughly 71% fared better than the benchmark.
In terms of sector holdings, financial services (22%), industrials (16%) and consumer cyclicals (14%) were the top three favourites.
Motilal Oswal MOSt Focussed Multicap 35 clocked a growth of 14.8% outperforming the category average by over 11%. Stocks such as Ajanta Pharma, Lupin Laboratories, Eicher Motors and Page Industries aided the fund’s impressive showing.
Other funds that clocked in some good numbers were Escorts High Yield Equity and UTI MNC, each at 12%.
SBI PSU Equity Fund posted a loss of 8.6%, blame it partly on the exposure to SBI and ONGC. ICICI Prudential Dividend Yield Equity (-6.3%) and Birla Sun Life Dividend Yield Plus (-3.6%) also found place among the laggards.
Morningstar India ELSS Category: 3.9%
Category benchmark (BSE 200): 2.1%
Of the 34 ELSS funds, 71% scored over the performance of the S&P BSE 200 index. A holdings-based analysis revealed the category favourite sectors as financial services (26%), consumer cyclicals (17%) and industrials (17%).
IDFC Tax Advantage (11.8%) trounced the average by nearly eight percentage points. The fund’s investments in Aegis Logistics and Bajaj Finance contributed to the strong showing in no small measure. BNP Paribas Long Term Equity (8.9%) came in at second place, while Edelweiss ELSS (7.9%) occupied the third position.
At -2.9%, HDFC Tax Saver was the worst-performing fund in the category. Investments in stocks such as SBI and Tata Motors Ltd Class A hurt the fund’s performance. Reliance Tax Saver (-2.3%) and Sahara Taxgain (-1.9%) also featured among the half-yearly laggards.
