Net Asset Value(s)

RNS Number : 3738Z

India Capital Growth Fund Limited

06 March 2013

 



6 March 2013

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

Net Asset Value statement as at 28 February 2013

Net Asset Value

The Company announces its Net Asset Value per share as at 28 February 2013 was 52.02 pence.

In February the Net Asset Value (NAV) fell 4.0% in Sterling terms, whilst the BSE Midcap Index was down 6.6%, delivering an outperformance against the notional benchmark of 2.6% in Sterling terms. Against Ocean Dial's Composite Index, the portfolio delivered an outperformance of 1.6%.

Portfolio update

Positive contributors to the portfolio's performance came from Berger Paints (up 9.1%), Jyothy Labs (up 4.5%) and Idea Cellular (up 4.1%). Negative attribution came from Manappuram Finance (down 20.3%), Dewan Housing (down 19.3%) and Multi Commodity Exchange (down 19.1%).

Market and economic update

Indian equity markets gave back the advances of late last year, with the BSE Sensex falling 5.2% in February, compounded by the currency depreciating against Sterling by 3.2% and the US Dollar by 2.1%; the equity markets and the performance of the currency continue to remain closely correlated. Furthermore in February, India underperformed the entire emerging market peer group in US Dollar adjusted terms. This performance comes in spite of continued strong inflows from foreign investors who pumped an additional USD4.1bn into equities, taking the year's total to USD8.2bn. A proportion of this inflow in February was absorbed by capital market transactions totaling USD3.7bn. Locals continue to sell; this month, aggregate outflows reached USD1.6bn. and it is assumed that some of this domestic selling pressure is in anticipation of support for future public sector divestments.

On the home front, aside from additional equity supply, the principal reasons for the fragile markets were a combination of weaker than expected GDP data and mixed corporate earnings. Thus third quarter FY13 GDP growth was reported at 4.5%, below expectations of 4.9%, whilst the full year forecast was revised down to 5%. Earnings were reported at best "in line" and at worst well below mooted expectations, the latter predominately in the infrastructure, capital good sectors and public sector banks. The Finance Minister delivered a limp Budget to Parliament in the latter part of February, which appears to be sufficiently prudent to stave off an imminent Sovereign ratings downgrade, but achieved little to stimulate much needed private sector investment. For more in depth analysis please refer to our short Budget note at the link http://www.oceandial.com/files/file/download/id/316. Looking ahead, there is room for monetary easing which will support growth, but the need for fiscal austerity may limit the government's room to manoeuvre.

Portfolio analysis by sector as at 28 February 2013

Sector	No. of Companies	% of Portfolio
Financials	11	35.4%
Industrials	6	15.7%
Consumer Discretionary	4	12.6%
Consumer Staples	3	9.5%
Health Care	3	8.4%
Energy	3	7.3%
Information Technology	2	3.8%
Telecommunication Services	1	3.0%
Materials	1	1.6%
Total Equity Investment	34	97.3%
Net Cash		2.7%
Total Portfolio		100.0%

Top 10 holdings as at 28 February 2013

Holding	Sector	% of Portfolio
Federal Bank	Financials	5.8%
Jyothy Laboratories	Consumer Staples	5.2%
Yes Bank	Financials	4.6%
KPIT Cummins	IT	3.8%
Max India	Industrials	3.8%
Dish TV India	Consumer Discretionary	3.5%
Jammu & Kashmir Bank	Financials	3.5%
Manappuram Finance	Financials	3.3%
Indusind Bank	Financials	3.3%
Indian Bank	Financials	3.3%

Portfolio analysis by market capitalisation size as at 28 February 2013

Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap <INR15bn)	4	11.7%
Mid Cap (INR15bn <M/Cap<INR100bn)	18	52.9%
Large Cap (M/Cap > INR100bn)	11	32.7%
Unlisted	1	0.0%
Total Equity Investment	34	97.3%
Net Cash		2.7%
Total Portfolio		100.0%

 

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