Birla Equity Plan has come a long way since inception to emerge as a category beating fund. Except for 2007, the fund has consistently beaten the category returns over the past five years. In 2007 the fund's returns (55.87 per cent) were marginally less than the category average (56.37).
The fund manager churns the portfolio quite aggressively. He moves swiftly in and out of sectors spotting opportunities and strategically timing his entry and exit. Good stock picks have in fact become the USP of the fund. For instance picks such as Automobile Corp-oration of Goa have delivered significant returns for the fund at a time when the auto sector has been in the grip of bears. In fact the fund has maintained its position in the automobile sector at a high of 12 per cent through this bear phase while the average category exposure to the sector has hovered around 6 per cent.
The fund has displayed an uncanny ability to sense an opportunity at the right time. It did so during the third quarter of 2006 by timing his entry in the banking stocks to perfection. Earlier the fund manager used to have a small portfolio of around 30- 35 stocks in which he invested with conviction. Now the portfolio of is bulging with close to 50 stocks.
ABB is the top holding of the fund (5.31 per cent) followed by TRF (4.56 per cent) and Gammon India (3.69 per cent). The fund entered ABB in November 2007 after five years it exited the stock. For those of you who have a tech heavy portfolio and are looking for an ELSS fund to balance such a discrepancy can definitely look at Birla Equity Plan.
This article was originally published on March 06, 2008.
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