The investment objective of the scheme is to generate capital appreciation by investing predominantly in equity and equity-related instruments through contrarian investing.
The fund has consistently outperformed the benchmark (S&P BSE 500 Total Return Index) and its peers (funds ranked under the value/contra equity category in CMFR-June 2018) in all the trailing periods under analysis.
The fund has outperformed the benchmark in four of the five market phases since inception, including the recent rally led by global liquidity and domestic reforms.
An investment of Rs 10,000 in the fund on April 11, 2007, (inception of the fund) would have grown to Rs 44,520 on October 17, 2018, at an annualised rate of 13.83 per cent, as compared to the category and the benchmark, which would have grown to Rs 48,303 (14.64 per cent per annum) and Rs 32,288 (10.7 per cent per annum), respectively.
Monthly systematic investment plan (SIP) of Rs 10,000 for 10 years in the fund would have grown to Rs 2.86 million (16.7 per cent annualised return) compared to Rs 2.27 million (12.4 per cent) in the benchmark.
During the past three years, the fund has maintained a predominant allocation to large-cap stocks; it averaged 59.7 per cent of the portfolio during this period, while 16 per cent was allocated to mid-cap and 14 per cent to small-cap.
The fund has actively managed allocations across 30 sectors during the past three years. It reduced allocation to the auto sector from 17.8 per cent in September 2016 to 4.6 per cent in August 2018. During this period, the Nifty Auto TRI grew by 6.0 per cent per annum versus 18.6 per cent per annum by the benchmark S&P BSE 500 TRI. The fund increased allocation to the consumer non-durables sector from 0.8 per cent in July 2017 to 11.9 per cent in August 2018. During this period, the Nifty India Consumption TRI grew 19.6 per cent compared to 14.2 per cent growth of the benchmark S&P BSE 500 TRI.
VIP Industries, HDFC Bank, Maruti Suzuki, Reliance Industries and Hindustan Petroleum were the major contributors to the fund’s performance during the period under analysis.
The fund invested in 116 stocks during the past three years and held eight consistently. Among the consistently held stocks, HDFC Bank, Hero MotoCorp, Mahindra & Mahindra, Cyient, and MRF were the highest contributors to the fund’s performance.
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