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Ratings Turn Tranquil

December was a relatively calm month for the VR Fund Ratings, with fewer upgrades & downgrades...

December is generally the most happening month of the year. As the year draws to an end, the partying scene hots up, everyone starts devising New Year resolutions and deliberations are made on how the coming year can be made better than the one that's going away. Overall, a lot keeps happening through December.

However, in contrast, the last month of 2008 turned out to be quite placid at the Value Research Fund Ratings. After the volatility seen in a few previous months, December dulled in comparison with very few changes taking place.

The most notable change of the month was the upgrade of Benchmark Banking BeES. The fund jumped up from 2-stars to gain a place in the prestigious 5-star category for the first time in its rated history. The fund's success - 16.23 per cent returns in December - can be attributed to the better performance of the banking sector and indices.

The other major upgrade of the month was that of Canara Robeco Nifty Index, which posted 7.45 per cent returns in December. The fund was elevated from 2-stars to 4-stars.

Reliance MIP was another fund to be upgraded to the elite 5-star category.

As far as the major downgrades are concerned, there was only one, that of Escorts Opportunities. The fund came down from 3-stars to the bottom of the barrel 1-star category. The fund has generally kept a higher allocation to equity but failed to capitalize of the surge in equities in December, delivering returns of 2.47 per cent as against the category average of 3.24 per cent.

The new members to join the fund ratings were Canara Robeco Infrastructure (3-stars), DWS Credit Opportunities Cash 15D Plan (2-stars) and ICICI Prudential Services Industries (2-stars).

Apart from them, two funds made a re-entry into the ratings after staying out for five months. Canara Robeco Income, which was last seen 3-stars in June 2008 entered into the 5-star category straightaway. The other fund was IDFC GSF Investment Plan A, with a 4-star rating.

On the flip side, two funds - DSPBR Savings Plus Conservative and Templeton India CAP Gift Plan - were dropped from the fund ratings.

A look at the fund houses reveals that ICICI Prudential finally dethroned Birla Sun Life as the top fund house. The former had five 5-star funds at the end of December while the latter was left with only three. However, when the 4-star and 5-star funds were combined, Birla Sun Life won with 17 as against ICICI Prudential's 14.

Canara Robeco AMC's performance was specially remarkable with four upgrades, zero downgrades and 2 new funds in its tally of 13 rated funds. Reliance saw six upgrades with zero downgrades as well.

Overall, the fund ratings witnessed 52 upgrades, 56 downgrades and 382 of the 492 funds rated in November maintaining a status quo.



Fund House  1 Star  2 Star  3 Star  4 Star  5 Star  Total
Baroda Pioneer  3  1  4
Benchmark 1  1 1 1 4
Birla Sun Life 4 4 16 14 3 41
Canara Robeco 1  3 5 4 13
DBS Chola 4 4 3 2 1 14
Deutsche  5 1 2 2 10
DSPBR 3 3 6 2 3 17
Escorts 1  1  1 3
Fidelity  1 5   6
Fortis 2 2 3  2 9
Franklin Templeton 2 6 14 11 2 35
HDFC 1 11 10 9 2 33
HSBC 4 2 7 5  18
ICICI Prudential 2 5 15 9 5 36
IDFC 4 2 2 2 4 14
ING 2 2 6 4 2 16
J M 4 6 4   14
Kotak Mahindra 2 5 8 6 1 22
LIC 1 5 7 2 1 16
Lotus India  1 5   6
Principal Pnb 1 7 9 3 1 21
Quantum   1   1
Reliance 1 2 5 6 4 18
Sahara  2  2 2 6
SBI 6 5 6 5 2 24
Sundaram BNP Paribas  6 7 4 3 20
Tata 2 11 8 10 2 33
Taurus 1 1 3   5
UTI Mutual Fund 2 9 17 5 3 36
As on December 31, 2008