Net Asset Value(s)

RNS Number : 2936L

India Capital Growth Fund Limited

07 January 2009

 



India Capital Growth Fund Limited

07 January 2009

 India Capital Growth Fund Limited (the 'Company' or 'ICGF')

31 December 2008 NAV Statement

Net Asset Values

The Company announces its net asset values per share as at 31 December 2008:

Net asset value per share - undiluted    42.87 p

Net asset value per share - fully diluted   42.87 p

Update

NAV for the month was up 12.5%, helped by an 8.9% appreciation of the Rupee against Sterling. The BSE Sensex was up 6.1% and the BSE Small Cap Index was up 11.5% on the month.  Most of the holdings in the portfolio registered useful gains in the month, although performance was held back by declines in the share price in three of the larger holdings. For the year to 31 December 2008 as a whole, NAV fell 73.9%, while the BSE Sensex fell by 52.4%, the BSE Small Cap Index fell by 72.4% and the Rupee appreciated 11.1% against Sterling. 

Indian equities were among the worst performers worldwide in 2008 and India was the third worst performing emerging market in 2008 (after Russia and Pakistan). However Indian GDP growth at 7.6% year-on-year for the quarter ended 30 September 2008 was still one of the best worldwide. 

After seven months of being net sellers in the market, FIIs turned net buyers of USD 433.5 million in December. This was against a background of a continued fall in inflation (wholesale price inflation fell to 6.38% for the week ending 20 Dec 2008), and lower interest rates (the Reserve Bank cut the repo rate to 5.5%, the reverse repo rate to 4% and the 10 year Government Bond yield ended the year at a 5.56%, a 5 year low). While 2009 may also be a difficult year (industrial production and exports have been falling), lower interest rates and substantially lower commodity prices including oil are expected to help the Indian economy later in the year.

The strategy throughout the year has been to support existing investee companies which we believe have an attractive future and not to sell in panic. Even so, fundamental company analysis has meant little in an extraordinarily volatile market dominated by pressures on forced sellers and the flight of FIIs. While the NAV fall has been dramatic, we believe that current valuations are extremely attractive and that once markets stabilise investee companies' underlying performance should once again be reflected in their share prices.  

In the month of December the Company continued to buy into existing investments where we believe the valuations to be most attractive, using cash generated by selling out of a few other holdings, including a complete exit from one holding. 

The net cash as on 31 December was GBP 3.2 mn, 10.1% of the portfolio.

 Analysis of holdings at 31 December 2008 

Sector Summary	No. of Companies	% of Portfolio
Textiles	2	14.7%
Financial Services	3	14.5%
Pharmaceutical services and packaging	1	11.2%
Transportation	2	11.0%
Media	2	9.4%
IT	3	6.8%
Process controls	1	6.6%
Housing & Construction	4	4.3%
Offshore oil & gas services	1	3.4%
Hotels	1	3.2%
Engineering / Manufacturing	2	2.6%
Others	2	2.2%
Total investments	24	89.9%
Net Cash		10.1%
Total Portfolio		100%

  Top 10 holdings at 31 December 2008

Holding	Sector	% of Portfolio
Bilcare	Pharma Packaging	11.2%
Marwadi Shares and Finance	Financial Services	9.5%
S. Kumars Nationwide	Textiles	9.5%
Varun Shipping	Transport	8.0%
ICSA India	Process Controls	6.6%
Prime Focus	Media	5.2%
Grabal Alok Impex	Textiles	5.2%
Logix Microsystems	IT	5.0%
IOL Netcom	Media	4.2%
Great Offshore	Offshore Oil and Gas Services	3.4%

 Portfolio breakdown by size at 31 December 2008

Size	No. of Companies	% of Portfolio
Small Cap	21	79.6%
Unlisted	3	10.3%
Cash		10.1%
Total		100.0%

 

END

 

 

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