Net Asset Value(s)

RNS Number : 6169Y

India Capital Growth Fund Limited

06 March 2017

 

6 March 2017

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

Net Asset Value statement at 28 February 2017

Net Asset Value

The Company announces its Net Asset Value per share as at 28 February 2017 was 101.71 pence.

In February the Net Asset Value (NAV) was up 7.5% in Sterling terms, whilst the BSE Mid Cap Total Return Index was up 7.8%, delivering an under performance against the notional benchmark of 0.3%. In local currency terms, the NAV was up 5.3% for the month.

Portfolio update

Positive attribution to the portfolio's performance came from Dewan Housing Finance (up 17.1%), Federal Bank (up 14.9%), Welspun India (up 17.0%) and Dish TV (up 14.9%). Negative attribution came from The Ramco Cement (down 5.3%), Skipper (down 6.0%) and Kitex Garments (down 5.9%).

Market and economic update

India's equity markets continued the rally in February. The BSE Sensex rose 3.9%, whilst the BSE Mid Cap Index rose 5.4%. Stocks reacted positively to a fiscally sound Federal Budget and better than expected corporate results. This is the first release of corporate earnings since demonetisation began late last year.

After four consecutive months of selling, Foreign Institutions turned net buyers to the tune of US$1.6bn for the month, whilst Domestic Institutions continued to add equity exposure, albeit at a lower level of just US$137m. India's currency appreciated 1.7% against the US Dollar and 2.1% against Sterling in February.

Voting unanimously once again, the Reserve Bank of India (RBI) unexpectedly kept its key policy rate unchanged at 6.25%. The RBI Committee highlighted increased risk from higher core inflation, uncertainty from international factors and a potential inflationary impact of the economy "remonetising". More importantly, the RBI changed its liquidity stance to "neutral" from "accommodative," signalling an end to the easing cycle although Consumer Price Inflation for January 2017 eased further to 3.2% (on lower food prices) and Wholesale Price Inflation spiked to 5.3% from 3.4% on firming global commodity prices. GDP growth for the quarter end December 2016 was recorded at 7.0%, compared to 7.4% in the prior quarter; a much better outcome than was forecast following November's demonetisation. Both private and government expenditure were significant contributors, whilst agriculture delivered higher levels of production. The Central Statistical Organization (CSO) maintained its full year GDP growth estimate at 7.1% for FY17.

Portfolio analysis by sector as at 28 February 2017
Sector	No. of Companies	% of Portfolio
Financials	7	25.8%
Materials	9	20.7%
Consumer Discretionary	7	18.6%
Consumer Staples	5	11.2%
Industrials	4	9.9%
IT	2	4.7%
Healthcare	2	3.4%
Real Estate	2	3.1%
Total Equity Investment	38	97.4%
Net Cash		2.6%
Total Portfolio	38	100.0%
Top 20 holdings as at 28 February 2017
Holding	Sector	% of Portfolio
Yes Bank	Financials	5.7%
Dewan Housing	Financials	4.7%
Federal Bank	Financials	4.6%
Jyothy Laboratories	Consumer Staples	4.1%
Motherson Sumi Systems	Consumer Discretionary	3.6%
Welspun India	Consumer Discretionary	3.4%
Kajaria Ceramics	Industrials	3.4%
Indusind Bank	Financials	3.1%
Dish TV India	Consumer Discretionary	3.1%
PI Industries	Materials	3.0%
Ramkrishna Forgings	Materials	2.9%
City Union Bank	Financials	2.9%
The Ramco Cements	Materials	2.9%
Sobha Developers	Real Estate	2.8%
Exide Industries	Consumer Discretionary	2.7%
Sagar Cements	Materials	2.7%
Finolex Cables	Industrials	2.6%
Max Financial Services	Financials	2.6%
Tech Mahindra	IT	2.4%
Berger Paints India	Materials	2.4%
Portfolio analysis by market capitalisation size as 28 February 2017
Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap < US$2bn)	25	59.4%
Mid Cap (US$2bn < M/Cap < US$7bn)	8	21.5%
Large Cap (M/Cap > US$7bn)	5	16.5%
Total Equity Investment	38	97.4%
Net Cash		2.6%
Total Portfolio	38	100.0%

 

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