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Fund pick: GIC Growth Plus II

Value Research

Background

Growth Plus II is an open-end equity fund since April 98. Initially launched as a closed-end equity fund before the 1994 bull phase, Growth Plus II had a good start and touched a high of 13.40 in just 2 months. Subsequent to that, it got pushed down the hill but nevertheless, mirrored the performance of the BSE National Index. The fund has, for the original investor, given an annualised return of a mere 10.94 per cent. Before its open ending, the fund restructured its portfolio and was able to shed the illiquid stocks.

Performance

Growth Plus II is well diversified across large and mid cap Cyclical, FMCG and Pharma stocks, with a greater tilt towards cyclical stocks. In March 1999, the fund was spread over 80 scrips, but the top 10 stocks accounted for 85 per cent of the net assets. After a long period of unimpressive performance the fund is now doing well with the broad-based market turnaround and was up 45% over the past three months, as on September 30, 1999 and ranked 12th among 46 equity schemes. The fund has gained 94 per cent in the last one year. The fund, from July 1, 1999, has adopted the forward pricing and carries an entry load of 2 per cent. However the fund levies a contingent deferred sales load (Exit load) of 1 per cent for investments of less than one year.

Outlook

Growth Plus II could be an attractive long-term investment for its well diversified equity portfolio. With the economy showing strong signs of a turnaround and the cyclicals and value stocks expected to perform well, the fund can be expected to even better its recent past performance. The fund is to declare a dividend on October 28, which it claims could be up to 30 per cent and the book closure of the fund will be from October 21 to 28. Hence an investment till October 20 will be eligible for the dividend. However, to earn this tax-free dividend, an investor has to bear the entry and the exit load besides assuming the market risk for atleast 10 days.

FUND BASICS
Objective	Size	NAV:8/10	Exit Pr	Entry Pr	Total Ret
Growth	313.47 cr	18.39	18.39	18.75	11.28%
BENCHMARK COMPARISONS (%)					30/9/99
	1M	3M	6M	1Yr	3Yr
Fund	1.3	45.4	59.9	93.6	21.7
Sensex	-2.2	14.6	32.4	53.6	13.7
Nat. Index	1.3	23.3	39.6	60.4	15.1
Obj. Avg.	4.9	24.1	22.2	49.5	9.9
Top Holdings (30/9/99)					Net Asset (%)
Hindalco					15.83
M T N L					14.85
MCDowell					12.06
BSES					7.98
Godfrey Philips					7.06
ITW Signode					6.87
Sterlite Industries					6.57
Wyeth Leaderle					4.78
United Breweries					4.52
GAIL					4.29
Total					84.81

Mutual Funds

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