Net Asset Value(s)

RNS Number : 0494L

India Capital Growth Fund Limited

06 August 2013

 



6 August 2013

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

Net Asset Value statement as at 31 July 2013

Net Asset Value

The Company announces its Net Asset Value per share as at 31 July 2013 was 42.47 pence.

In July the Net Asset Value (NAV) was down 7.8% in Sterling terms, whilst the BSE Mid Cap Index fell 8.9%, delivering an outperformance against the notional benchmark of 1.1% in Sterling terms. Against Ocean Dial's Composite Index, the portfolio delivered an underperformance of 1.0%.

Portfolio update

Positive contributors to the portfolio's performance came from Idea Cellular (up 19.4%), Lupin (up 11.5%) and Eicher Motors (up 6.5%). Negative attribution came from Yes Bank (down 29.7%), Federal Bank (down 14.6%) and Sintex Industries (down 35.0%).

Market and economic update

Volatility in Indian equity markets intensified and though the Main Board Sensex Index fell 0.3%, the Mid Cap Index fell 7.1%. This precipitous fall followed the Reserve Bank of India's (RBI) monetary policy U Turn, shifting from an accommodative stance of liquidity infusion into the banking sector to an implicit tightening position. The clear intention is to reduce speculation and volatility in the currency and signposts that external sector considerations, such as the US Federal Reserve's proposed QE tapering program, have taken priority over the domestic economic recovery. Investors fear the higher cost of borrowing will impact growth as well as increasing the risk of greater asset quality issues on banks' lending books. Beyond the banks, cyclical sectors, in particular Infrastructure and Industrials, plus those with weak balance sheet positions, have been most affected.

In addition the RBI reduced its FY14E GDP growth estimate to 5.5% from 5.7%, citing weak investment conditions. On the positive the Government has raised foreign direct investment (FDI) limits in Telecoms to 100%, Insurance from 26% to 49% and relaxed the riders of the FDI policy on multi-brand retail. Good rains (17% above long term average) will support rural consumption and reduce food price inflationary concerns.

Portfolio analysis by sector as at 31 July 2013

Sector	No. of Companies	% of Portfolio
Financials	10	23.4%
Industrials	6	15.1%
Consumer Discretionary	4	13.5%
Consumer Staples	3	11.4%
Health Care	3	10.8%
Information Technology	3	7.2%
Telecommunication Services	1	4.2%
Energy	2	3.7%
Materials	2	3.4%
Total Equity Investment	34	92.7%
Net Cash		7.3%
Total Portfolio		100.0%

Top 20 holdings as at 31 July 2013

Holding	Sector	% of Portfolio
Jyothy Laboratories	Consumer Staples	5.8%
KPIT Cummins Infosystems	IT	4.8%
Lupin	Healthcare	4.6%
Federal Bank	Financials	4.4%
Idea Cellular	Telecommunications	4.2%
Kajaria Ceramics	Consumer Discretionary	4.1%
Emami	Consumer Staples	3.6%
Yes Bank	Financials	3.5%
IPCA Laboratories	Healthcare	3.4%
Motherson Sumi Systems	Consumer Discretionary	3.4%
Eicher Motors	Industrials	3.4%
Jammu & Kashmir Bank	Financials	3.3%
Max India	Industrials	3.2%
Dish TV India	Consumer Discretionary	3.0%
Berger Paints India	Consumer Discretionary	3.0%
Larsen & Toubro	Industrials	3.0%
Indusind Bank	Financials	2.9%
Divi's Laboratories	Healthcare	2.8%
Cairn India	Energy	2.6%
Dewan Housing Finance Corp	Financials	2.5%

Portfolio analysis by market capitalisation size as at 31 July 2013

Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap <INR15bn)	4	6.0%
Mid Cap (INR15bn <M/Cap<INR100bn)	19	54.1%
Large Cap (M/Cap > INR100bn)	10	32.6%
Unlisted	1	0.0%
Total Equity Investment	34	92.7%
Net Cash		7.3%
Total Portfolio		100.0%

 

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