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Unconventional Leader

Reliance Growth is an unconventional diversified equity fund. It follows multiple investing styles. In some stocks, it is a buy-and-hold investor and in some others, it gets in and out quickly

It holds a high amount of cash to capitalise on new opportunities. The fund has been successful at its stock picking and holds a portfolio laden with mid- and small-caps. It prides itself on being the only mutual fund to own a new stock. It has been in the top quartile for the previous three calendar years and deserves a place in all long-term portfolios.

In 2002, Reliance Growth gained 56 per cent and the next year, it rose 156 per cent. It added another 42.57 per cent in 2004. As on August 6, 2005, it has returned 50.30 per cent. These performances have led to unprecedented rise in the popularity of this fund which has seen its assets grow from a meagre Rs 39 crore in June 2003 to Rs 1,722 crore today. At present, it's close for fresh investors.

The fund manager has a strong belief in the potential of small-cap stocks. Unlike a conventional diversified fund, it maintains high allocation to them. For instance, the fund's average allocation to small-cap stocks in the first six months of 2005 has been around 24.23 per cent against the category average of 13.83 per cent. Its penchant for mid- and small-caps has helped improve returns in 2005 too.

The fund has made some smart sector moves. After 9/11, the fund took a lead by keeping a higher exposure in the then hot sectors of PSU and technology. Then, it lost less in the subsequent bear phase of mid-2002 due to a low FMCG allocation. Following the rally in bank and auto stocks in 2003, Reliance Growth increased exposure in both sectors. And recently, the fund's higher allocation to technology and engineering stocks added to its superlative performance. The fund has benefited this year from high allocation to basic engineering stocks like Bharat Earth Movers, Crompton Greaves, KSB Pumps, Kirloskar Brothers and NRB Bearings. Picks like Century Textiles, Greaves Cotton and Sintex Industries have also proved to be highly rewarding.

A unique investment approach and superlative returns make Reliance Growth suitable for all portfolios.