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Feather in the Cap

For investors looking for quality, this fund is a class apart. Franklin India Bluechip has been an impeccable performer and is among the best choices for equity fund investors looking for a pure large-cap portfolio.

The fund garnered 120 per cent returns as against the category average of 112 per cent in the year 2003. Such a performance can be attributed to the fund's strategy of sticking to its old large-cap favourites. This can be gauged from the fact that the fund continued to buy Infosys when it fell in April that year and benefited tremendously as the stock rebounded. Similarly, in case of HPCL, it held its nerve and increased its exposure, even after its divestment was put on hold by the Supreme Court.

The fund didn't jump into the mid-cap rally bandwagon in that year. Instead, it persisted with its large-cap holdings. When mid-cap PSU banks were the flavour of the season, the fund managed to perform with its old favourites SBI and ICICI bank.

In 2002, Bluechip was amongst the top quartile performers with 24 per cent returns as against category average of 19.6 per cent. The fund increased its exposure in energy stocks which in the subsequent year also, served the fund well. The fund wasn't too far behind in bearish times either. The fund was amongst the top five performers in 2000, when all its peers fell like a pack of cards. Large-cap IT stocks like Infosys and Wipro and non-IT stocks like ITC and HDFC saved it from being part of the falling crowd.

Similarly, in the year 2001, when tech bubble bursts and Ketan Parekh's scam was unearthed, the fund shed off 16 per cent compared to the category's 19 per cent fall.

Though, in September 2001(post 9/11), it lost 16 per cent but the last quarter of 2001 augured well for the fund. It made up for lost ground due to the recovery made by its top IT holdings Infosys and HCL Tech coupled with a rally in cement and auto stocks.

In the volatile phase of 2004 (Jan-Apr), the fund managed to scrape through with a negative 23 per cent return, just mirroring the category's performance. Though it may not be at the top of the heap at the moment, its long-term performance has so far been worth appreciating. So, there is every reason for this fund to be the core of each investor's equity portfolio.