In its short existence, UTI Infrastructure has more than proven the merit of its theme.
The first infrastructure fund to be launched, it was a classic example of the early bird getting the worm. It found a spot in the top quartile of the category in 2005, generating 57 per cent returns and outdoing the average peer by a margin of more than 10 per cent. In 2006, it leapt to the topmost slot with returns of 61.48 per cent.
This year, despite a few bumps in the road in the first quarter, when real estate and cement corrected sharply, the fund is going great guns. Its year-to-date returns (as on October 11, 2007) were 49.53 per cent, sharply ahead of the category average of 33.40 per cent.
When you are catapulted to the No. 1 slot with such superior performance, you can't help but attract attention. As a result, its assets under management rose from under Rs 60 crore (April 2004) to over Rs 1,400 crore at present.
Though spread across stocks of different market caps, of late it has developed a bias for large-cap stocks. According to the September 2007 portfolio, large caps cornered 61 per cent of the assets.
Despite being a thematic fund, it has a reasonably diversified portfolio of 40-45 stocks.
Naturally, capital goods, construction and energy dominate the portfolio, but this infrastructure fund also has a significant exposure to metals and technology. This one makes for a worthy and diversified selection if you want to bet on the capital expenditure wave sweeping across the country.
This article was originally published on December 07, 2007.
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