Equity MFs see rise in NAV

COIMBATORE: The continuous upswing in the markets has brought the net asset value (NAV) of many mutual funds in the equity diversified category above Rs 10, a price at which new fund offers are available in the market.

Of the 270-odd equity MFs, 61 funds whose NAVs plunged to single digit levels are now quoting above Rs 10, analysis shows. Taurus Infrastructure, whose NAV dipped to Rs 4.66 on March 9 when sensex touched a three-year low of 8160.4, has seen it improving to Rs 10.62 on May 27.

Incidentally, 25 of funds that saw huge drops in NAV have outperformed sensex during the period, delivering a return of over 74%. Sensex spurted 73% in this period. While nine funds in the equity MF space have posted a return of over 100%, more than 70 funds have emerged category beaters, recording a rise in excess of 73%. All funds except one gave a double digit return with even the second worst performer showing a 17.4% increase.

Most of the top performing funds in the category are from the infrastructure, mid and small-cap space that gained at a faster pace on the bourses. Funds that have managed a good recovery include JM Basic, Magnum Midcap, Principal Junior Cap, Value Research data shows.

With infrastructure expected to get a big boost in the second innings of the UPA government, many fund houses have started picking stocks in the sector. Tata Power, Reliance Infrastructure, Power Finance Corporation (PFC), Punj Lloyd, NTPC and Shriram Transport Finance are among the favourite picks of fund managers, an analysis by domestic brokerage firm Sharekhan shows. In fact, Punj Lloyd, PFC and NTPC are among the stocks that have witnessed the highest growth in exposure for MFs in April.

Though MFs had not pruned cash levels in April, some fund houses have increased their equity exposure.

source: Economictimes

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