Monthly Briefing Feb 2003

Lindsell Train Investment Trust PLC
17 March 2003

The Lindsell Train Investment Trust PLC
As at 28th February 2003

Fund Objective
To maximise long-term total returns subject to the avoidance of loss of absolute
value and with a minimum objective to maintain the real purchasing power of
Sterling capital, as measured by the annual average yield on the 2.5%
Consolidated Loan Stock.

Net Asset Value                        GBP 91.43
Share Price                            GBP 95.50
Discount (Premium)                          4.5%
Market Capitalisation                 GBP 19.1mn

Source: Bloomberg; NAV - LTL

Performance (based in GBP)           Feb       Jan        Dec         YTD         Since Launch
NAV                                 +1.9%     -3.8%      -1.2%       -2.0%           -8.6%
Share Price                         +0.0%     +0.5%      +0.6%       +0.5%           -4.5%

Source: Bloomberg. Based in GBP.

Top 10 Holdings                        % NAV                        Industry Breakdown                     % NAV
US Gov Treasury 6.25%                  16.6                         Bonds                                  38.3
Lindsell Train Japan (Dist)            13.3                         Preference Shares                      12.8
Lindsell Train Global Media (Dist)     11.6                         Media                                   7.4
US Gov Treasury IL 3.875%               7.7                         Banks & Investment Co.                  7.0
21/2% Consolidated Loan Stock           7.6                         Leisure & Entertainment                 7.1
HBOS 6.125% Non Cum                     7.4                         Food & Beverage                        17.1
UK Treasury 2.5%                        6.0                         Investment Fund                        24.9
Barr AG                                 5.8                         Cash & Equivalent                     (14.6)
Glenmorangie plc A&B                    5.4                         Total                                  100.0
HBOS 9.25% Non Cum                      5.4

Geographical Breakdown                   % NAV                      Currency Exposure                    % NAV
Bonds                                    38.3                       USD                                   53.9
                 UK              13.7                               JPY                                  (0.9)
                 US              24.3                               EUR                                   2.3
Preference                               12.8                       GBP                                   44.8
Shares                                   38.6                       Total                                100.0
Equities         UK              29.1
                 US               4.2
                 Japan            3.0
                 Europe           2.3
                                         24.9
Funds            LT Japan        13.3
                 LT Global Media 11.6
                                        (14.6)
Cash &
Equivalent
Total                                    100.0



Fund Manager's Comments

The net asset value rose 1.9% driven by a rise in the US dollar versus Sterling
(over 50% of the net assets are exposed to US dollars) and continued advances in
the prices of the long-term fixed interest holdings.

For the first time we sold a small part of our fixed interest positions.
Specifically we reduced by 25% our holding in the US inflation-linked long-term
bond. It has proved to be our best performing bond rising in price by 11% since
purchase and falling in yield (real yield - i.e. the yield over and above the
current rate of US inflation) from 3.5% to 2.5% when we sold. We think the yield
may eventually fall to approximately 2.0%, but recognize that we are unlikely to
catch the top so propose, if prices give us the opportunity, to sell in stages.
This year the price of the bond has performed particularly well even versus
conventional bonds. This is a reflection of investors' general concern about
inflation. If inflation rises the inflation-linked bonds provide some protection
against that eventuality unlike conventional bonds whose income would fall in
real terms.

We have outlined in previous monthly reviews our views on inflation and
reiterate today that we do not believe that there is likely to be any
sustainable inflation (in the developed world) that will impinge on the real
returns from bonds. That is not to say that consumer price inflation in the US
and the UK will never be positive, it will. But the influences causing that will
be temporary and not structural as they proved to be from the mid 1960's to the
mid 1990's, when semi-permanent levels of future inflation deflated the real
value of bond income. Given this view you might well wonder why we own an
inflation protected security in the first place. This was all to do with our
view on the likely demand for these instruments should long term institutions
revise their view on their weighting in equities. Clearly with equity markets
having fallen this has occurred. Securities guaranteeing real and fixed returns
have been in greater demand as institutions recognize these securities better
match their liabilities with far less risk.

If we are correct in our assessment of the lack of inflation, the securities
that should rise most are conventional bonds. Over 30% of the portfolio is
invested in these. We have made money but not as much as we hope to. We still
expect long-term government yields to fall to 3-4%. Yields on our government
bonds are between 4-5% having fallen from 5-6%. We judge that investors are
still reluctant to embrace the idea of no inflation. The implied inflation rate
(the difference between inflation protected bond yield and conventional ones) is
2.3% today. We think that in due course conventional bonds will perform better
than inflation linked ones as the market adjusts its current expectation of
long-term inflationary pressures further downwards.

The sale of part of the inflation-linked bond was also influenced by the price
of the assets we were able to buy. We added to existing equity holdings in the
portfolio accessing average dividend yields approximately 70% higher than the
yield on the bond and in each case higher than the cost of our borrowings. At
the same time we enhanced the tax efficiency of the trust. As we described in
January's note it is important that our bond income does not exceed our expenses
and our debt financing costs, otherwise we are subject to corporate tax on the
difference. Now that short-term rates are on the way down our borrowing costs
are falling, which risks this occurring. Selling the holding in the bond helps
to mitigate this problem.

Unfortunately the trade has lost us value thus far. The bond price continues to
rise and the stocks to fall. Nevertheless we plan to repeat this trade again,
hopefully a number of times, at more fortuitous prices. In this way we should
continue the process of raising the income generated by the net assets of the
Company and in doing so increase the Company's ability to compound that income
over time for the benefit of all shareholders.



Fund Manager                   Launch Date                              Denominated Currency
Nick Train                     22 January 2001                          GBP


Year End                       Dividend                                 Benchmark
31st March                     Ex-date:   June                          The annual average yield on
                               Payment:   August                        the 21/2% Consolidated Loan
                                                                        Stock.


The Board                      Management Fees                          Registered Address
Rhoddy Swire                   Standard Fee: 0.65% p.a.                 Lindsell Train Investment
Michael Mackenzie              Performance Fee: 10% of annual           Trust
Donald Adamson                 increase in the share price, plus        77A High Street
Michael Lindsell               dividend,                                Brentwood
                               above the gross annual yield of          ESSEX  DM14 4RR
                               the 21/2% Consolidated Loan Stock.


Sedol No                       Bloomberg
3197794                        LTI LN



Disclaimer
The contents in this document is solely for information purposes only. The
information contained herein does not constitute an offer or invitation to buy
or subscribe any securities or funds in any jurisdiction in which such
distribution is not authorised. Nothing in this document constitutes investment,
legal, tax or other advice and cannot be relied upon in making any investment
decision. Applications to invest in some of the funds must only be made on the
basis of offer documents which may only be available for private circulation.
The information contained in this document is published in good faith and
neither Lindsell Train Limited nor any other person so connected assumes any
responsibility for the accuracy or completeness of such information as provided.
No representation is made or assurance given that any statements made, views,
projections or forecasts are correct or that objectives will be achieved.
Lindsell Train and/or persons connected with it may have an interest in the
Fund.  The value of investments and the income from them may go down as well as
up and are not guaranteed. Past performance is no guarantee of future
performance. You may not get back the amount you invested. Foreign exchange
rates may cause the value of investments to go up or down. Investments may be
subject to higher volatility in certain funds and the investment value may fall
suddenly and substantially.

                             Lindsell Train Limited
                       35 Thurloe Street, London  SW7 2LQ
                  Tel. [phone]  Fax. [phone]
                 [e-mail]  www.lindselltrain.com

                Lindsell Train Limited is regulated by the FSA.

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