Net Asset Value(s)

RNS Number : 4040B

India Capital Growth Fund Limited

06 October 2015

 



6 October 2015

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

Net Asset Value statement at 30 September 2015

Net Asset Value

The Company announces its Net Asset Value per share as at 30 September 2015 was 78.31 pence.

In September the Net Asset Value (NAV) rose 3.4% in Sterling terms, in line with the notional benchmark, the BSE Mid Cap Index, which was also up 3.4%. Against Ocean Dial's Composite Index, the portfolio outperformed by 0.3%. In local currency terms, the NAV was up 0.6%.

The Company also announces its fully diluted NAV per share as at 30 September 2015 was 72.54 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 at the portfolio level was driven by Neuland Laboratories (up 50.5%), Kajaria Ceramics (up 16.1%), Indusind Bank (up 9.8%) and Tech Mahindra (up 8.2%). Negative attribution came from Motherson Sumi Systems (down 24.1%), PI Industries (down 11.6%) and Mahindra CIE (down 11.1%).

Market and economic update

Indian equity markets lingered in September. The BSE Mid Cap Index rose 0.6%, whilst the BSE Sensex fell 0.5%.  Foreign institutions reduced exposure to the tune of US$877m over the month, while domestic institutions sustained net investment. The Indian Rupee appreciated by 2.5% against Sterling and 0.9% against the US Dollar. Gross tax receipts for August were up 42% on a year on year basis; indirect tax growth remains the driver but with improving trends in both income and corporate tax evident. Non-tax receipts were reported at 72% of fiscal year-end target with seven months to go.

In its scheduled policy meeting the Reserve Bank of India (RBI) cut the prime lending rate by 0.5% to 6.75%, surprising consensus expectations of a 0.25% cut. Room for the bigger than expected cut was created by consumer inflation, lower still at 3.7% for August, helped by the limited impact of a weaker than expected monsoon season on food prices, and weak external demand. The RBI remains dovish, reiterating the emphasis on policies designed to boost growth and expressing an accommodative stance for the foreseeable future. Additionally the RBI lowered its inflation target to 5.8% from 6% in FY16 and to 5% by FY17, but revised down its GDP forecast from 7.6% to 7.4% for FY16, citing an ongoing lack of appetite for new investment in the private sector and slower growth globally. Subsequent to the rate cut, commercial banks have announced further reductions in both deposit and lending rates, easing the process of monetary transmission into the real economy. In a further positive move, the RBI increased the limits on foreign investors' capacity to own Government (both Federal and State) securities. This will be supportive of the currency and bond prices, a positive outcome for investors.

Portfolio analysis by sector as at 30 September 2015
Sector	No. of Companies	% of Portfolio
Financials	9	27.6%
Consumer Discretionary	5	14.9%
Industrials	6	14.8%
Materials	5	12.6%
Healthcare	4	11.3%
Consumer Staples	4	10.2%
IT	3	6.2%
Total Equity Investment	36	97.6%
Net Cash		2.4%
Total Portfolio	36	100.0%
Top 20 holdings as at 30 September 2015
Holding	Sector	% of Portfolio
Federal Bank	Financials	4.6%
Jyothy Laboratories	Consumer Staples	4.5%
Dewan Housing	Financials	4.4%
Kajaria Ceramics	Industrials	4.1%
Yes Bank	Financials	3.7%
Divi's Laboratories	Healthcare	3.7%
Max India	Financials	3.7%
PI Industries	Materials	3.7%
Indusind Bank	Financials	3.6%
Dish TV India	Consumer Discretionary	3.5%
Tech Mahindra	IT	3.3%
City Union	Financials	3.1%
Exide Industries	Consumer Discretionary	3.1%
Balkrishna Industries	Consumer Discretionary	2.9%
Berger Paints India	Materials	2.9%
Ajanta Pharma	Healthcare	2.8%
Lupin	Healthcare	2.8%
Emami	Consumer Staples	2.8%
Motherson Sumi Systems	Consumer Discretionary	2.7%
Mahindra CIE Auto	Consumer Discretionary	2.6%
Portfolio analysis by market capitalisation size as 30 September 2015
Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap <INR60bn)	12	24.0%
Mid Cap (INR60bn <M/Cap<INR250bn)	15	46.5%
Large Cap (M/Cap > INR250bn)	9	27.1%
Total Equity Investment	36	97.6%
Net Cash		2.4%
Total Portfolio	36	100.0%

 

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