Net Asset Value(s)

RNS Number : 4207P

India Capital Growth Fund Limited

07 February 2019

 

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

Net Asset Value statement at 31 January 2019

Net Asset Value

The Company announces its Net Asset Value per share as at 31 January 2019 was 93.04 pence.

In January the Net Asset Value (NAV) was down 8.5% in Pound Sterling terms, whilst the BSE Mid Cap TR Index was down 10.4%, delivering an outperformance against the notional benchmark of 1.9%. In local currency terms, the NAV was down 3.6% for the month.

Portfolio update

Positive contribution to the portfolio's performance came from NIIT Technologies (up 14.0%), Kajaria Ceramics (up 9.1%) and Aurobindo Pharma (up 7.5%). Negative contribution came from Jyothy Laboratoies (down 13.9%), Motherson Sumi Systems (down 15.7%) and Dewan Housing Finance (down 45.5%).

Market and economic update

Looming elections and perceived corporate governance lapses were in focus as investors continued to favour large caps in January; the BSE-Sensex moved up 0.5% compared to a 5.7% fall for the BSE-Midcap Index. The Indian Rupee depreciated 1.9% against the US Dollar and 5.3% against the Pound Sterling, driven by a 13.8% rally in oil and net outflows from foreign institutional investors (US$75m). Domestic institutions were net buyers to the tune of US$304m for the month.

The Government announced its interim budget which focused on alleviating rural distress in an attempt to boost sentiment in the run-up to general elections in May 2019. Cash disbursements to 120 million small and marginal farmers (direct payments of INR6,000 per annum) and a tax break for lower earners (exempting earnings of up to INR500,000 per annum) were announced. The Finance Ministry restated its commitment to the Government's target of limiting the fiscal deficit to 3.4% in FY20.

Indian Companies began reporting results for Q3FY19 ending in December 2018. Sectors which outperformed were; IT (good revenue growth and a healthy deal pipeline), Pharmaceuticals (new launches), Consumer staples (demand growth and margin expansion). Private sector banks reported in line with expectations highlighting steady trends in loan growth with stable asset quality for retail banks. As expected, Non-Banking Finance Companies' funding issues impacted disbursement growth. Sectors which disappointed were Automotive (weak demand and lower margins), and Cement (lower realisation and profitability) despite strong volume growth.   

Portfolio analysis by sector as at 31 January 2019
Sector	No. of Companies	% of Portfolio
Financials	8	21.9%
Materials	8	18.5%
Consumer Discretionary	5	12.2%
Information Technology	3	10.2%
Consumer Staples	4	9.9%
Industrials	4	9.2%
Health Care	3	8.0%
Real Estate	2	3.2%
Total Equity Investment	37	93.1%
Net Cash		6.9%
Total Portfolio	37	100.0%
Top 20 holdings as at 31 January 2019
Holding	Sector	% of Portfolio
Tech Mahindra	Information Technology	4.9%
City Union Bank	Financials	4.5%
Federal Bank	Financials	4.4%
NIIT Technologies	Information Technology	4.3%
Kajaria Ceramics	Industrials	4.2%
Jyothy Laboratories	Consumer Staples	3.9%
Divi's Laboratories	Health Care	3.8%
Aurobindo Pharma	Health Care	3.4%
PI Industries	Materials	3.3%
Ramkrishna Forgings	Materials	3.3%
Radico Khaitan	Consumer Staples	3.2%
IDFC Bank	Financials	3.2%
Berger Paints India	Materials	3.2%
Motherson Sumi Systems	Consumer Discretionary	3.2%
Welspun India	Consumer Discretionary	3.1%
Sobha Developers	Real Estate	3.0%
Indusind Bank	Financials	2.9%
Exide Industries	Consumer Discretionary	2.8%
Balkrishna Industries	Consumer Discretionary	2.4%
Yes Bank	Financials	2.2%
Portfolio analysis by market capitalisation size as 31 January 2019
Market capitalisation size	No. of Companies	% of Portfolio
Small Cap (M/Cap < US$2bn)	25	55.0%
Mid Cap (US$2bn < M/Cap < US$7bn)	10	30.3%
Large Cap (M/Cap > US$7bn)	2	7.8%
Total Equity Investment	37	93.1%
Net Cash		6.9%
Total Portfolio	37	100.0%

 

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