SENSEX NIFTY
Sep 16, 2013, 10.37 PM IST | Source: Moneycontrol.com

Sundaram Select Focus: Regular underperformer; don’t invest

Financial advisor Arnav Pandya presents his views on Sundaram Select Focus. He recommends on not investing in the fund as it has been consistently underperforming.

Sundaram Select Focus is an equity oriented open ended fund to achieve capital appreciation by investing in equity and equity related instruments of select stocks. Financial advisor Arnav Pandya does not recommend it as it has been consistently underperforming in the recent times. 

Nature: Equity oriented open ended

Inception: July 2002

Assets under Management: Rs 455 crore at the end of August 2013

Fund Manager: J Venkatesan

Analysis

• The fund focuses on concentrated holdings in the large cap space for its portfolio. At the end of March 2012 the fund had the highest exposure to financial services at 22 percent of its portfolio.  Energy oil and gas, IT and consumer goods were some of the other areas where the share in the portfolio was high.

Infosys was the top individual holding with nearly 6 percent of the portfolio in this company. ICICI Bank, Bharti Airtel, United Spirits, Power Finance Corporation, Reliance Industries, PNB and Cairn India were some of the other top holdings present.  The CNX Nifty was the benchmark for the fund and it was a slight underperformer over the one and three year time periods.

• Six months later there were some slight changes at the sector level in the fund. Financial services was the top sector with a share of over 25 percent with IT, Energy-oil and gas and industrial manufacturing being other significant areas. 

There were a total of 48 stocks in the portfolio and the turnover ratio was high at 220 percent. Reliance Industries was the top individual holding with HDFC bank, Zee Entertainment, HDFC, L&T, ICICI Bank, Infosys and Satyam being some of the other holdings.  The fund remained an underperformer over the one and three year time periods.

• By the end of February 2013 the share of financial services in the portfolio had risen to over 30 percent.  IT, Energy oil and gas and auto were some of the other leading sectors present in the portfolio.  The portfolio turnover ratio had come down slightly to 177 percent.

Reliance Industries was the top individual holding with ICICI bank, HDFC, L&T, Infosys, ITC, Tech Mahindra and Indusind bank being some of the other stock in the portfolio.  The fund was an underperformer over the one and three year periods ended December 2012.

• At the end of August 2013 the fund continued to maintain its highest exposure to the financial services sector with IT, energy, consumer goods and Pharma being some of the other top areas for investment. 

The number of stocks in the portfolio had come down to 38 and the portfolio turnover ratio to 142 percent. Infosys and Reliance were the top holdings with a share of 8 percent each.  ITC, Tech Mahindra, HDFC, ICICI Bank, HDFC bank, L&T and TCS were some of the other leading holdings.  The fund was an underperformer over the one and three year time period ended June 2013.

• Investors can look for other options in the large cap space as the fund has been a consistent underperformer in recent times

Q UTI was the only mutual fund for the period of:
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ICICI Bank Bharti Airtel United Spirits
Power Finance Reliance PNB
Cairn India HDFC Bank Zee Entertain
HDFC Larsen Infosys
Tech Mahindra TCS

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