Net Asset Value(s)

RNS Number : 3805U

India Capital Growth Fund Limited

06 April 2016

 

6 April 2016

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

Net Asset Value statement at 31 March 2016

Net Asset Value

The Company announces its Net Asset Value per share as at 31 March 2016 was 77.47 pence.

In March the Net Asset Value (NAV) was up 12.3% in Sterling terms, whilst the BSE Mid Cap Index was up 11.0%, delivering an outperformance against the notional benchmark of 1.3%. Against Ocean Dial's Composite Index, ICGF outperformed by 1.5%. In local currency terms, the NAV was up 12.1% for the month.

The Company also announces its fully diluted NAV per share as at 31 March 2016 was 71.98 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 Dewan Housing (up 27.8%), Dish TV (up 28.0%), Yes Bank (up 25.6%) and Jyothy Laboratories (up 14.3%). Negative attribution came from Lupin (down 15.7%), Emami (down 5.2%) and PI Industries (down 1.5%).

Market and economic update

Indian equity markets bounced back strongly in March in line with global cues. Thus the BSE Sensex was up 7.5% whilst the BSE Mid Cap Index rose 10.9%, supported by additional inflows of US$4.0bn from Foreign Institutions, although Domestic Institutions sold US$ 1.9bn. The Indian Rupee also recovered some value, appreciating 3.2% against the US Dollar and 0.1% against Sterling.

Consumer Price Inflation for February came in at 5.2%, lower than the 5.7% reported in January, driven by falling food prices. However Industrial Production contracted to 1.5% on account of weak manufacturing data. Encouragingly, the Lower House of Parliament, currently sitting for the "Budget Session", approved both the Aadhaar and the Real Estate Regulation bills. Aadhaar will support the Government's initiative to transfer subsidy payments directly to individual's bank accounts, helping to reduce "leakage", whilst the Real Estate Regulation bill should improve consumer confidence in buying property. Elsewhere, in a concerted effort to reduce costs for the embattled Public Sector Banks, the Government announced cuts in interest rates for small savings schemes which we interpret as a further indication the Finance Ministry is finally addressing this issue credibly.

Following a six month pause, the Reserve Bank of India (RBI) cut the repo rate by 25bps in its April meeting. This was expected following the Government's commitment to fiscal discipline as demonstrated in last month's budget. Monetary policy remains accommodative with further room for cuts in interest rates, providing the impending monsoon "delivers". To aid additional monetary transmission, the RBI cut the marginal standing facility. This will increase liquidity in the system, lower borrowing costs and encourage the banks to pass the benefits through to the consumer.

Portfolio analysis by sector as at 31 March 2016
Sector	No. of Companies	% of Portfolio
Financials	10	27.8%
Materials	7	16.5%
Consumer Discretionary	5	13.4%
Industrials	5	12.8%
Healthcare	5	9.7%
Consumer Staples	4	9.2%
IT	3	6.7%
Total Equity Investment	39	96.1%
Net Cash		3.9%
Total Portfolio	39	100.0%
Top 20 holdings as at 31 March 2016
Holding	Sector	% of Portfolio
Yes Bank	Financials	4.7%
Jyothy Laboratories	Consumer Staples	4.4%
Federal Bank	Financials	4.3%
Kajaria Ceramics	Industrials	4.2%
Dewan Housing	Financials	4.1%
Indusind Bank	Financials	3.9%
PI Industries	Materials	3.5%
Divis Laboratories	Healthcare	3.5%
City Union	Financials	3.4%
Berger Paints India	Materials	3.4%
Motherson Sumi Systems	Consumer Discretionary	3.3%
Dish TV India	Consumer Discretionary	3.1%
Exide Industries	Consumer Discretionary	3.1%
The Ramco Cements	Materials	2.9%
Finolex Cables	Industrials	2.8%
Tech Mahindra	IT	2.7%
Sobha Developers	Financials	2.6%
Max Financial Services	Financials	2.5%
Emami	Consumer Staples	2.4%
Essel Propack	Materials	2.3%
Portfolio analysis by market capitalisation size as 31 March 2016
Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap < INR60bn)	14	32.9%
Mid Cap (INR60bn < M/Cap < INR250bn)	17	38.6%
Large Cap (M/Cap > INR250bn)	8	24.6%
Total Equity Investment	39	96.1%
Net Cash		3.9%
Total Portfolio	39	100.0%

 

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