10 new equity funds & as many debt funds entered the Fund Ratings for the first time in March 2009
04-Apr-2009 •Research Desk
March, being the last year of the financial year, typically witnesses a lot of movements in the Indian capital markets. This year, March 2009, was no different. Benchmarks Sensex and Nifty went through their usual gyrations but ended the month on a high. The last week of March 2009 was particularly good for the markets.
As is often the case, the markets' gyrations and reflected in the Value Research Fund Ratings as well. March 2009 saw 10 new equity funds, and an equal number of debt funds, entering the Fund Ratings family. Amongst the newly rated equity funds, IDFC Imperial Equity earned the 4-star rating directly. Among the others, three funds earned the 3-star rating, while the rest were given the 2-star and 1-star ranks.
The fate of the newly rated debt funds was much better. DWS Insta Cash Plus Super Inst began its rating journey with a place in the elite 5-star category. Apart from this fund, two funds earned the 4-star ranking while five earned the 3-star ranking. Amongst the newly rated debt funds, a total of six funds belong to the AIG, while three belong to Fidelity.
Elsewhere, Birla Sun Life Balance's consistent performance finally bore fruit. The fund earned the prestigious 5-star rank for the first time after having entered the ratings family way back in October 2002.
Another fund from the Birla stable, Birla Sun Life Buy India, impressed with its performance and earned the 4-star rating after a gap of 23 months. The fund had fallen by 32.93 per cent in this financial year, less than the category average of (-) 39.60 per cent.
Taurus Starshare made its way back to the 4-star ranking, which it had lost in February. The fund had delivered an above average return of 7.89 per cent in March.
Amongst the losers, HSBC Floating Rate Long-term lost its 5-star status, which it had acquired in August 2007. UTI Infrastructure also lost its elite status for the first time after joining the ratings family in April 2007. It might be interesting to note that in February, Tata Infrastructure had lost its elite status, and was rated at 3-stars this time as well, which means that the infrastructure funds have not been in the best of health of late.
Tata Treasury Manager Fund HI moved up from 2-stars in February 2009 to the 4-star position in March 2009. The fund has posted above average returns in the past few months.
In March, two equity funds left the ratings family because of their low assets. Baroda Pioneer Growth which was at 4-stars and Sahara Growth, which was at 5-stars in February 2009, were the two equity funds that got unrated this month. ING Balanced, which was at the 2-star position in February, was also not rated this month because of its low assets.
Furthermore, due to the number of funds in the Debt Floating Rate Short Term Institutional category falling below 10, the whole category has been omitted from the ratings family.
Among the fund houses, the competition between Birla Sun Life Mutual Fund and ICICI Prudential Mutual Fund continued in March. Birla Sun Life came out on top with 16 4- and 5-star rated funds, while ICICI Prudential and Franklin Templeton came up just one short, with 15 funds each.
However, ICICI Prudential earned the boasting rights for holding the maximum 5-star funds. The fund house has seven of them, while Birla Sun Life has five.