Net Asset Value(s)

RNS Number : 6660G

India Capital Growth Fund Limited

05 March 2015

 



5 March 2015

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

Net Asset Value statement at 28 February 2015

Net Asset Value

The Company announces its Net Asset Value per share as at 28 February 2015 was 82.10 pence.

In February the Net Asset Value (NAV) was down 1.1% in Sterling terms, whilst the BSE Mid Cap Index was down 1.7%, delivering an outperformance against the notional benchmark of 0.6%. Against Ocean Dial's Composite Index, ICGF outperformed by 0.8%. In local currency terms, the NAV increased 1.4% for the month.

The Company also announces its fully diluted NAV per share as at 28 February 2015 was 75.07 pence. 

The above fully diluted NAV assumes that the 37,500,710 Subscription Shares rights will be exercised at their subscription price of 61 pence. The Subscription Shares have a subscription date of 6 August 2016. However, if at any time after 6 August 2015 the average middle market quotation for an Ordinary Share for at least 10 consecutive trading days is 5% or more above the subscription price, the Company has the right, (but not the obligation) by an announcement on a RIS to change the subscription date for exercise of the Subscription Shares to an earlier date (being a date not less than 30 days after the Company's announcement) that it is bringing forward the subscription date. In that event an announcement will be made on a RIS and a notice of the revised subscription date will be given to all holders of the Subscription Shares on the register at 5.00pm on the date falling three business days following the announcement of the revised subscription date.

Portfolio update

Positive attribution to the portfolio's performance came from PI Industries (up 21.4%), Kajaria Ceramics (up 10.1%) and Lupin (up 10.2%). Negative attribution came from Neuland Laboratories (down 29.2%), Balkrishna Industries (down 7.6%) and The Ramco Cements (down 7.9%).

Market and economic update

Indian equity markets were flat for the month; the BSE Sensex was up 0.1% whilst the BSE Mid Cap Index was up 0.7% as markets eagerly awaited the Budget which was announced on 28 February. Foreign Institutional Inflow was US$1.4bn for the month and domestic institutions were also net investors. The Rupee depreciated by 2.5% against Sterling and 0.1% against the US Dollar in the month.

The Finance Minister delivered a Budget that was growth orientated whilst maintaining a balance. It facilitates job creation and provides for an increase in public expenditure in crucial areas of infrastructure, whilst remaining fiscally responsible. It focuses on areas of policy already prioritised by the Government, such as manufacturing and the "Make in India" campaign, tax and banking sector reform, improving co-operation between the Centre and the States and cracking down on corruption. It also reinforces the Government's intentions to facilitate "ease of doing business" in India in order to attract further foreign investment. Overall this consistency is very encouraging. Also included are elements specifically directed towards the common man, calculated to ensure reform remains 'inclusive'. It also opens up new areas of innovative reform, such as measures to monetise gold assets and increasing non cash payments in the system. The Budget should be viewed positively by the market as it strengthens the platform on which India is being rebuilt, whilst hastening the much needed near-term recovery in corporate earnings.

Inflation for January 2015 of CPI at 5.1% and WPI at -0.4% were lower than expectations helping the cause for a further rate cut. Also India's trade deficit narrowed to an 11-month low of US$8.3bn in January as oil imports declined.

Corporate results for Q3FY15 were overall below expectation. Only the IT services sector and some select healthcare and consumer stocks managed to beat expectations, reflecting the challenges in the current environment.

Portfolio analysis by sector as at 28 February 2015
Sector	No. of Companies	% of Portfolio
Industrials	10	27.4%
Financials	7	21.5%
Materials	4	10.5%
Consumer Staples	4	10.1%
Healthcare	4	9.5%
Consumer Discretionary	3	8.7%
IT	3	8.6%
Energy	1	1.2%
Total Equity Investment	36	97.5%
Net Cash		2.5%
Total Portfolio	36	100.0%
Top 20 holdings as at 28 February 2015
Holding	Sector	% of Portfolio
Federal Bank	Financials	4.9%
Dewan Housing	Financials	4.3%
Tech Mahindra	IT	4.3%
Kajaria Ceramics	Industrials	3.9%
Jyothy Laboratories	Consumer Staples	3.9%
Motherson Sumi Systems	Consumer Discretionary	3.6%
PI Industries	Materials	3.6%
Yes Bank	Financials	3.5%
Emami	Consumer Staples	3.2%
Indusind Bank	Financials	3.1%
Max India	Industrials	3.0%
Lupin	Healthcare	3.0%
Gujarat Pipavav	Industrials	2.8%
Exide	Industrials	2.8%
Dish TV India	Consumer Discretionary	2.8%
Eicher Motors	Industrials	2.8%
Berger Paints India	Materials	2.8%
Divi's Laboratories	Healthcare	2.7%
Ajanta Pharma	Healthcare	2.6%
Balkrishna	Industrials	2.6%
Portfolio analysis by market capitalisation size as 28 February 2015
Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap <INR60bn)	12	23.6%
Mid Cap (INR60bn <M/Cap<INR250bn)	16	48.4%
Large Cap (M/Cap > INR250bn)	8	25.5%
Total Equity Investment	36	97.5%
Net Cash		2.5%
Total Portfolio	36	100.0%

 

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