FMCG Funds Back on Track

The good times continued for the equity fund investors in the week ended August 5, 2005. All the equity funds' categories delivered positive returns and majority of them also beat their benchmarks.

Bond funds, though, could not sustain their previous week's momentum on back of a range-bound bond market and rise in yields.

EQUITY FUNDS

The Leaders: FMCG funds were back on track. The three-fund category gained an average 4.08 per cent to beat the 2.51 per cent return of their benchmark BSE FMCG Index. Prudential ICICI FMCG and Franklin FMCG gained over 4.50 per cent, while Magnum FMCG added 2.67 per cent.

The Laggards: After a great run in the week ended July 29, 2005, banking funds paused for a breather last week. They could add only 0.21 per cent last week but did well to outperform the 2.24 per cent loss of the benchmark BSE Bankex.

Diversified and tax-planning funds: Diversified equity funds added an average 3.64 per cent, while tax-planning funds gained 3.61 per cent last week. Both beat the 1.55 per cent return of the benchmark Sensex.

Top-5 diversified equity funds: Taurus Discovery Stock (8.37 per cent), Taurus Starshare (7.41 per cent), ABN AMRO Opportunities (7.21 per cent), Magnum Multiplier Plus (6.58 per cent), and GIC Fortune '94 (6.38 per cent).

Bottom-5 diversified equity funds: Reliance Regular Savings Equity (-0.03 per cent), Principal Junior Cap (0.40 per cent), JM Emerging Leaders (0.60 per cent), Tata Midcap (1.13 per cent), and Kotak Contra (1.58 per cent).

Top-5 tax-planning funds: Canequity-Tax Saver (8.04 per cent), Franklin India Taxshield (4.61 per cent), Prudential ICICI Tax Plan (4.54 per cent), BoB ELSS '96 (4.33 per cent), and Escorts Tax Plan (4.09 per cent).

Bottom-5 tax-planning funds: Franklin India Index Tax (2.12 per cent), Alliance Capital Tax Relief '96 (2.38 per cent), HDFC Long Term Advantage (2.44 per cent), Principal Personal Tax Saver (2.68 per cent), and Principal Tax Savings (2.69 per cent).

Among rest of the equity categories, auto funds gained an average 1.41 per cent, while petro funds shot up 4.04 per cent. Pharma funds added 2.21 per cent to underperform the 2.60 per cent return of the benchmark BSE Healthcare Index. Technology funds too did well. They gained 3.75 per cent to beat the 1.46 per cent return of the benchmark BSE IT Index.

Equity oriented hybrid funds, which normally maintain 60:40 equity, debt ratio, gained 2.43 per cent last week.

BOND FUNDS

Medium-term debt funds managed 0.04 per cent, while medium and long-term gilt funds slipped 0.05 per cent last week. Debt short-term (0.09 per cent), floaters (0.10 per cent), ultra short-term (0.10 per cent) and short-term gilt (0.08 per cent) funds delivered positive returns. MIPs gained an average 0.56 per cent.

How They Fared Objective    Return Equity: Tax Planning   3.61 Equity: Diversified   3.64 Equity: Pharma   2.21 Equity: Auto   1.41 Equity: Banking   0.21 Hybrid: Equity-oriented   2.43 Equity: FMCG   4.08 Equity: Technology   3.75 Hybrid: Monthly Income   0.56 Equity: Petroleum   4.04 Debt: Medium-term   0.04 Debt: Short-term   0.09 Debt: Floating Rate   0.1 Debt: Ultra Short-term   0.1 Gilt: Short-term   0.08 Gilt: Medium & Long-term   -0.05 Sensex    1.55 BSE IT    1.46 BSE HC    2.6 BSE FMCG    2.51